Ontario Government Announces Upcoming Changes to the RTA: Considerations for Landlords

Landlords, and particularly smaller landlords who can’t afford non-paying tenants, have been asking for changes to the Residential Tenancies Act (RTA) for a long time. The new Fighting Delays, Building Faster plan from the Ontario government outlines a number of measures that will help small landlords, particularly in the areas of overhauling the LTB to evict tenants that consistently don’t pay rent. It should be noted that these are all proposed changes, and nothing has been enshrined in legislation yet.  

Closing LTB Loopholes Used by Non-Paying Tenants

There are a large number of loophole closures proposed on pages 13-15 of the Plan’s technical briefing deck that would short-circuit some of the loopholes used by tenants to dodge evictions for persistent non-payment as long as possible. They include:

• Time to review orders or decisions reduced from 30 to 15 days
• Simplification of forms
• Shortening rent arrears eviction notice period from 14 to 7 days
• Guidelines for adjudicators to determine postponement of an eviction order
• Adding staff to speed up enforcement order process
• New issues cannot be raised at rent arrears hearings

All of these are important and welcomed. It would be good if the time between filing for an eviction and getting a hearing was addressed; in the 2-5 months that can take, the tenant will presumably still not be paying rent. 

Not even tenants can really take issue with something like an automatic eviction order being granted if rent is in excess of a certain dollar amount/has been unpaid for a certain number of months. Most small landlords are absolutely willing to work with tenants who are going through short-term issues, such as a job loss or illness. It’s the fear of persistent non-payment of rent that keeps landlords up at night, and it also may be keeping some properties off the market. 

Changes May End Month-to-Month Leases

By far the most controversial proposed change for tenants is the following:

The government would consult on alternative options on lease agreement expiry that could allow landlords to control who occupies their units and for how long, allowing them to adjust tenancy arrangements based on market conditions, personal needs, or business strategies. This could add flexibility for some landlords in the approach to leases, potentially unlocking additional rental unit stock.
–Fighting Delays, Building Faster Plan Technical Briefing Deck, Page 15, Bottom

This could mean that leases have to be renegotiated after the initial lease term ends, and wouldn’t automatically go month-to-month as they do now. With no further details, this would seem to help landlords who have been renting for an extremely long time to a tenant in a rent-controlled unit. They also seem to signal the end of rent control, as the price of the unit could presumably be renegotiated after a year. 

At the moment this section is extremely vague and will probably be removed or significantly toned down before anything hits the legislation phase, as it is seeing significant tenant blowback due to the threat of removing both rent control and security of tenancy. 

Why Ford is Introducing This: Get Vacant Units on The Market

Ford has stated that these changes are needed to unlock rental supply that prospective landlords are sitting on. We wrote about this last year – the vacant housing tax numbers in Toronto alone uncovered a significant amount of empty properties that could, instead, be housing Ontarians. 

All of these properties may not belong to investors who don’t want to be landlords because they’re afraid of bad tenants, but even if that only accounts for a small percentage of them, these new RTA changes could move the needle in opening up rental supply.

This Plan is a step in the right direction to reform the RTA, but more measures to speed evictions for non-payment are more likely to convince would-be landlords to start investing in rental properties or to start renting out the vacant ones they own. Until anything final is announced, it’s best not to make assumptions about anything put forward in this Plan. 

If there’s something you’d like to see included in the upcoming changes to the RTA, write your local MPP. It’s important for landlords to voice their concerns as tenant groups are definitely addressing their own issues about changes to the Act.