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.
1.9% Ontario's 2027 rent increase guideline (2.1% in 2026) | 90 days written notice, in the proper LTB form, before an increase takes effect |
$2,570 Toronto's average asking rent in August 2026, down 1.4% year over year | Nov 15, 2018 units first occupied after this date are not covered by the guideline |
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:
| Current rent | Maximum increase | New maximum rent |
|---|---|---|
| $2,000 | $38.00 | $2,038.00 |
| $2,400 | $45.60 | $2,445.60 |
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.
Want help planning rent increases or pricing a vacancy correctly? Contact our team or see the rental forms we use.
This article summarizes general Residential Tenancies Act principles and is not legal advice. Consult a paralegal or lawyer for guidance on your situation.
