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Fresh national credit data just confirmed a trend worth every GTA landlord's attention: consumer insolvencies hit a two-year high in Q2 2026, and the increase is concentrated almost entirely among renters and other non-homeowners. Here's what the data actually shows and what it means for how you screen and manage tenants right now.

The Data

According to TransUnion Canada's Q2 2026 Credit Industry Insights Report, the national consumer insolvency rate climbed to 1.10% — up from 0.94% two years earlier, and the highest level recorded in the past two years. Federal insolvency figures show 37,523 consumer insolvencies in the quarter, the highest quarterly volume since 2009. Critically, TransUnion notes this increase is driven predominantly by non-mortgage holders — insolvency rates among renters have moved above pre-pandemic levels, while rates among homeowners have actually remained below their pre-2020 levels.

Worth understanding too: nearly 80% of insolvency filings are now consumer proposals (structured repayment plans) rather than outright bankruptcy, up from about 60% before the pandemic — meaning most financially stressed renters are working through a formal repayment process rather than simply defaulting outright. Still, TransUnion notes roughly 1 in 5 financially distressed consumers eventually file for bankruptcy.

Why This Matters More Than a Generic Economic Headline

This isn't an abstract national statistic — it's a direct signal about the financial health of the tenant pool you're screening from. Rising renter-specific insolvency rates mean a somewhat higher baseline risk of a qualified-looking applicant experiencing genuine financial stress during their tenancy than in recent years.

What This Means for Your Screening Process

• Credit checks matter more now, not less. A thorough screening process that includes a genuine credit check is exactly the tool designed to catch early warning signs before you sign a lease — this data reinforces why skipping this step is a bigger risk than it might have been a few years ago.

• Income verification deserves extra scrutiny. With household debt at record levels even among people who are current on payments, verifying that an applicant's income genuinely supports the rent — not just meets a bare minimum ratio — is worth the extra diligence.

• Previous landlord references remain one of your best tools. A previous (not current) landlord's honest account of payment history is a meaningful signal that a credit report alone doesn't fully capture.

What This Doesn't Mean

This data doesn't mean you should assume every applicant is a risk, or discriminate based on general economic anxiety rather than an individual applicant's actual qualifications — Ontario's Human Rights Code protections still apply fully, including protections around source of income. The point isn't to screen more harshly across the board; it's to screen more thoroughly and consistently for every applicant, which is good practice regardless of the broader economic backdrop.

What This Means If You Already Have a Tenant Showing Signs of Financial Stress

If a previously reliable tenant starts showing signs of financial difficulty — a late payment, a request for a payment plan — this data suggests it's worth taking seriously and responding proactively rather than assuming it's an isolated blip. Understanding the proper notice and process for addressing rent arrears protects you if the situation doesn't resolve, while also giving you the option to work constructively with a tenant if that's the better outcome for both of you.

What This Means for Vacancy Decisions

Given this data, filling a vacancy quickly with the right tenant matters more than filling it quickly with any tenant. A vacancy that sits an extra week or two while you screen properly is a far better outcome than a fast placement that turns into a problem tenancy a few months in.

The Bottom Line

Rising renter insolvency rates are a real, data-confirmed trend worth factoring into how carefully you screen — not as a reason to panic, but as a reason to make sure your screening process is as thorough as it should already be. The landlords best positioned through this kind of economic environment are the ones with consistent, disciplined screening practices already in place.

Want to make sure your tenant screening process is built to handle this kind of environment? Contact our team or see our full verification process for how we approach this for every applicant.

This article is for general informational purposes and is not financial or legal advice.

Rental income is fully taxable, but the CRA also allows landlords to deduct a genuinely wide range of expenses against that income. Here's a practical rundown of what's actually deductible — and a few things landlords commonly get wrong.

The Core Categories of Deductible Expenses

Mortgage interest — the interest portion of your mortgage payments on a rental property is deductible, though the principal portion is not.

Property taxes on the rental property.

Insurance premiums, including standard landlord insurance and any group policy you carry specifically for the rental.

Repairs and maintenance — genuine repairs (fixing what's broken) are deductible in the year you pay for them, though this is an area where landlords commonly make a costly mistake (more on that below).

Property management fees, including a professional property manager's monthly fee, tenant placement fees, and any other management-related costs.

Utilities, if you pay them on the tenant's behalf rather than the tenant paying directly.

Advertising costs for finding a tenant.

Legal and accounting fees related to the rental — including costs for preparing leases, pursuing an LTB matter, or having your rental income properly filed.

Condo fees, if applicable, for a rental unit in a condominium.

The Repair vs. Improvement Distinction (Where Landlords Get Tripped Up Most)

This is genuinely one of the most common — and most expensive — mistakes we see: confusing a current expense (fully deductible the year you incur it) with a capital expense (which must be depreciated over time through Capital Cost Allowance, not written off all at once).

• A repair restores something to its original condition — fixing a broken window, patching a leaking roof, repairing a malfunctioning appliance. Generally a current expense, fully deductible now.

• An improvement enhances the property beyond its original condition — a full kitchen renovation, replacing a roof entirely rather than patching it, adding a new structure. Generally a capital expense, deducted gradually over years through CCA.

Landlords who deduct a major renovation in full the year they pay for it, assuming it counts the same as a repair, risk a reassessment down the road. If you're unsure which category a specific expense falls into, this is exactly the kind of question worth confirming with an accountant before you file, not after.

Capital Cost Allowance (CCA): Use With Caution

CCA lets you deduct a portion of the building's value (not the land) over time — but claiming CCA has a specific consequence worth understanding: it can trigger recapture and capital gains implications when you eventually sell the property. Many accountants advise against claiming CCA on a rental property you intend to hold long-term specifically because of this future tax consequence. This is a genuinely case-by-case decision worth discussing directly with an accountant familiar with rental property taxation.

What Non-Resident Owners Need to Know Additionally

If you're a non-resident owner, your rental income is subject to a separate withholding and reporting regime — generally a flat withholding tax on gross rental income, unless you file a Section 216 election to be taxed on net rental income instead, which allows you to claim these same deductions against your income. Given how different non-resident tax obligations are from a standard domestic landlord's filing, this is an area where professional guidance genuinely pays for itself.

What Good Record-Keeping Actually Looks Like

• Keep every receipt and invoice, organized by property if you own more than one rental.

• Separate current expenses from capital expenses as you incur them, rather than sorting through a year's worth of receipts at tax time.

• Track mileage and any home-office-related costs if you self-manage and do legitimate work related to the property from home.

• Get a clear monthly and annual expense breakdown if you use a property manager — this is something we provide as a standard part of our service, specifically so it can go straight to your accountant.

The Bottom Line

The list of deductible rental expenses is genuinely broad, but the repair-versus-improvement distinction and the CCA decision are exactly where landlords most commonly make costly mistakes. A conversation with an accountant familiar with rental property taxation before you file is almost always worth the cost.

Want your rental property's expenses tracked and organized properly throughout the year, ready for tax season? Contact our team to learn how we handle this for our managed properties.

This article is for general informational purposes and is not tax advice. Consult a licensed accountant for guidance specific to your situation.

This is one of the most consistently misunderstood rules in Ontario landlord-tenant law: you cannot charge a separate pet deposit, even though many landlords assume they can. Here's what the rule actually says, and what real options you have instead.

The Rule That Surprises Most Landlords

Under the Residential Tenancies Act, landlords in Ontario cannot charge a pet deposit, damage deposit, or any deposit beyond the standard rent deposit (commonly first and last month's rent) and, in limited circumstances, a key deposit. This applies regardless of whether the tenant has a pet — a "pet deposit" clause in a lease is generally unenforceable, even if the tenant agreed to it at signing.

Why This Rule Exists

The RTA is designed to cap what landlords can require upfront specifically to prevent a patchwork of additional deposits that could functionally price out tenants or create disputes over what portion of a deposit is refundable. Pet deposits fall into this restricted category regardless of good intentions on the landlord's part.

Can You Have a "No Pets" Clause At All?

This is the second surprising piece: a blanket "no pets" clause in a lease is also generally unenforceable in Ontario. Under the RTA, a provision in a tenancy agreement prohibiting animals is void — a landlord cannot terminate a tenancy or refuse to renew simply because a tenant has a pet, even if the original lease said no pets were allowed.

There are limited exceptions, generally tied to a condominium corporation's own enforceable rules (which operate under the Condominium Act, not the RTA) or specific circumstances involving a pet causing a genuine safety issue or substantial interference with other tenants' reasonable enjoyment of the property.

What Landlords Can Actually Do Instead

Screen for pet history during the application process. Ask directly about pets during screening — as part of a thorough tenant screening process — and factor pet ownership into your overall risk assessment for a specific applicant, the same way you'd weigh any other application detail.

Address damage through the standard rent deposit and legal recourse. If a pet causes damage beyond normal wear and tear, that's addressed the same way any other tenant-caused damage would be — through the standard security options available to landlords and, if necessary, through the Landlord and Tenant Board.

Include reasonable pet-related terms that don't amount to a ban. Reasonable, RTA-compliant additional terms — like requiring pets be leashed in common areas, or limiting the number of pets — are more likely to hold up than an outright prohibition, though even these should be drafted carefully.

Rely on condo corporation rules where applicable, if you're renting out a unit in a building with its own enforceable pet restrictions under the Condominium Act — these operate somewhat independently of the RTA's tenant protections.

What This Means Practically for Your Screening Process

Since you can't collect a pet deposit or enforce a blanket ban, your best protection is thorough screening upfront — asking about pet history, checking previous landlord references specifically about pet-related damage, and factoring that information into your overall tenant selection the same way you would income or credit history.

The Bottom Line

Ontario's rules around pets are more tenant-protective than most landlords assume — no separate pet deposits, and no enforceable blanket bans in most cases. The real protection lies in thorough screening before you sign a lease, not in deposit structures or prohibition clauses that likely won't hold up if challenged.

Want help building pet-related questions into your screening process the right way? Contact our team — or see our full verification process for how we handle this for every applicant.

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