About GTA Landlord | Trusted Property Management in Toronto & GTA

Ontario's 2027 rent increase guideline is 1.9%, but that number is a ceiling and not a target. With Toronto asking rents down year over year for 32 straight months, many landlords are asking whether a small increase is worth the risk of losing a good tenant. Here's how to think it through.

The Rules in Brief

According to Ontario.ca (updated June 23, 2026):

• The 2027 guideline is 1.9%. It's the maximum increase for most tenants in a year.
• 12 months must have passed since the last increase or the start of the tenancy.
• You must give written notice at least 90 days before the increase takes effect, using the proper Landlord and Tenant Board form (the N1).
• Some units are exempt: new buildings, additions and most new basement apartments first occupied after November 15, 2018, and units where the landlord and a new tenant agree on the rent at turnover.
• If a tenant is charged an improper increase, they can dispute it at the LTB within 12 months after the amount was first charged.

See our fuller guide to the 2027 guideline and Toronto rents.

What the Market Is Doing

According to Rentals.ca and Urbanation data for September 2026:

Mortgage Professional America reports that rents in Toronto and Vancouver have trended higher over the past six months and that annual declines have narrowed, and averages can hide big differences between buildings and bedroom counts. Check comparable listings for your own unit.

Is a 1.9% Increase Worth It?

Do the math on your own rent:

At any rent level, a 1.9% increase takes about 53 months (over four years) to earn back a single vacant month. That doesn't mean you shouldn't raise rent. It means an increase that pushes a good tenant out costs more than it earns.

A Simple Decision Checklist

• Compare your rent with current listings for similar units. If you're already at or above market, a hold may be wise.
• Weigh the tenant. A reliable tenant who pays on time and looks after the unit has real value.
• Count turnover costs: vacancy, cleaning, repairs, and the time to find and screen a new tenant.
• Give proper notice if you do raise it. A notice that's missing or defective may not be valid.
• Document your decision and keep copies of everything you serve.

Need Help?

Sources: Ontario.ca, Residential rent increases, Rentals.ca National Rent Report, Mortgage Professional America and CBC via Yahoo News Canada.

This article summarizes general Residential Tenancies Act principles and market data as of October 2026. It is not legal advice. Consult a paralegal or lawyer for guidance on your situation.

Ontario has set its 2027 rent increase guideline at 1.9%, down from 2.1% this year. At the same time, Toronto's latest rent data shows a market that's stabilizing rather than rebounding. Here's how both fit into your fall planning.

The 2027 Guideline

According to Ontario.ca, the rent increase guideline for 2027 is 1.9%. It's the maximum most landlords can raise an existing tenant's rent in a year without Landlord and Tenant Board (LTB) approval. For comparison, it was 2.1% for 2026 and 2.5% for each of 2023, 2024 and 2025. The guideline is based on Ontario's Consumer Price Index (June to May data) and is capped by law at 2.5%.

In dollars:

The Rules That Still Apply

• 12 months must have passed since the last increase or the start of the tenancy
• 90 days' written notice in the proper LTB form is required before the increase takes effect
• A tenant who believes an increase is improper can dispute it at the LTB within 12 months of the amount first being charged

A practical timing point: for an increase taking effect January 1, 2027, the 90-day notice needed to be served by roughly October 3, depending on how it was served. If you haven't served one yet, plan around a later effective date — and count the 90 days carefully.

What the Guideline Does Not Cover

Per Ontario.ca, the guideline doesn't apply to:

• New buildings, additions, and most new basement apartments first occupied for residential purposes after November 15, 2018
• Units on turnover — when a new tenant moves in, you and the tenant agree on the rent
• Community housing, long-term care homes, and commercial properties

If you're relying on the post-2018 exemption, Ontario.ca says landlords can add a term to the lease stating the unit is exempt and should keep records that prove it, such as building permits, occupancy permits, or builder documents. If there's a dispute, the landlord has to prove the exemption.

Our earlier breakdown of the 2026 guideline covers the mechanics in more detail.

What Toronto's Rent Data Says

The latest National Rent Report from Rentals.ca and Urbanation (released September 9) tracks asking rents on listings, which isn't the same as rents actually signed. For August 2026:

• Toronto's average asking rent was $2,570, down 0.3% from July and down 1.4% from a year earlier
• Within Toronto, two-bedroom asking rents were up 0.3% year over year and three-bedroom rents were up 3.5%
• Nationally, asking rents were down 4.8% year over year — the 23rd consecutive annual decline — and Ontario's were down 3.5%
• Nationally, condo asking rents fell 7.7% and houses, townhomes and other secondary-market units fell 8.3%, while purpose-built rentals fell 3.3%
• Scarborough was among the markets with the biggest annual declines (-9.3%), while North York ($2,513) and Oakville ($2,684) were among the higher-priced markets outside the six largest cities

Urbanation's president noted that trade-war uncertainty could weigh on rental demand through employment and confidence, and on supply through higher construction costs — a reason to treat this as a market to watch rather than assume a rebound.

What This Means for Your Pricing

• Price new tenancies to current comparables. The guideline doesn't cap what you ask on turnover, but current asking rents are softer than a year ago in many segments.
• Weigh a modest increase against vacancy. A guideline increase on a reliable tenant is often worth less than the cost of a vacant month. We cover the math in our vacancy post.
• Use the correct form and dates. An improperly served increase can be challenged, so build in your notice window now rather than in December.
• Keep proof of exemption. If your unit is exempt from the guideline, keep the paperwork in your file.
• Screen consistently. A documented screening process protects you whether the market is rising or falling.

The Bottom Line

A 1.9% guideline gives landlords a smaller annual ceiling, and Toronto's rent data suggests a market that has steadied but hasn't turned. For most owners, the practical work is getting notices right, pricing turnovers to what the market is actually paying, and keeping good tenants.

This article summarizes general Residential Tenancies Act principles and is not legal advice. Consult a paralegal or lawyer for guidance on your situation.