Ontario Rent Increase Guideline 2026: What Landlords Need to Know

This article is general information, not legal advice. For your specific situation, consult the Landlord and Tenant Board or a qualified professional.

The Ontario rent increase guideline for 2026 is 2.1%. That is the maximum a landlord can raise rent for most sitting tenants in a year without applying to the Landlord and Tenant Board. The number is set annually by the province and is tied to the Ontario Consumer Price Index, a measure of inflation; by law it cannot exceed 2.5%. The 2026 figure of 2.1% is the lowest guideline in four years, down from 2.5% in 2025.

Knowing the percentage is the simple part. Applying it lawfully, to the right units, with the right form, at the right time, is where landlords most often slip up. To see the new rent and the earliest it can take effect for your situation, use our free Ontario rent increase calculator.

Which units the guideline covers

The guideline applies to most private residential units covered by the Residential Tenancies Act, 2006: rented houses, apartments, basement apartments, and condominiums. There is one major exception that catches many newer landlords by surprise.

Units first occupied for residential purposes after November 15, 2018 are exempt from the cap. For an exempt unit, a landlord can raise rent by any amount, as long as proper notice is given. This was a deliberate policy choice intended to encourage new rental construction. If your unit was first lived in after that date, the 2.1% number does not bind you, though the notice rules below still do.

The rules that make an increase legal

Even when the 2.1% guideline applies, the increase is only lawful if you follow the procedure:

• Use Form N1. Rent increases for guideline-covered units must be delivered on the Landlord and Tenant Board's prescribed N1 form. A verbal notice or an informal note does not count.
• Give at least 90 days' written notice before the increase takes effect.
• Wait at least 12 months between increases. Rent can rise once every 12 months for the same tenant, not once per lease, and not at each renewal.

Miss any of these and the notice can be invalid, which means the increase does not take effect when you intended and has to be re-served correctly.

How to calculate it

The math is straightforward: multiply the current rent by the guideline. On $1,800 a month, a 2.1% increase is $37.80, bringing rent to $1,837.80. On $2,200, it is $46.20. Apply the percentage to the current lawful rent, round carefully, and keep a written record of the calculation. Improper rounding or using the wrong base rent are common errors that can undermine an otherwise valid notice.

When you need more than the guideline

If your costs have risen faster than the guideline (for example, after significant capital work or a large jump in property taxes), you can apply to the Landlord and Tenant Board for an above-guideline increase. This is an application process with evidence requirements and approval timelines, not something you can do on your own authority. Plan well ahead if you intend to pursue it.

What this means in 2026's market

A lower guideline lands at the same time as a softening rental market across much of Ontario, with vacancy rates rising and asking rents flat to falling in several cities. For landlords with sitting tenants, the 2.1% cap is the obvious lever, but it is rarely the most important one. In a market where good tenants have more options, the cost of turnover (vacancy, re-listing, screening, and the risk of a worse tenant) often dwarfs the few dollars a guideline increase adds. Many landlords this year are choosing retention over maximizing the increase.

Keep the paper trail

Whatever you decide, the increase is only as solid as your documentation: the N1 form served, the date it was delivered, the 90-day window, the date of the last increase, and the calculation. If a tenant disputes an increase at the Board, that record is your case. Keeping each tenancy's rent history, notices, and key dates in one place, rather than across email and a spreadsheet, is the difference between answering a dispute in minutes and reconstructing it from memory. Habyn's lease management and rent tracking tools are built to hold exactly that history.

The guideline changes every year, but the discipline does not: apply the right percentage to the right units, serve the right form on time, and keep the record that proves you did.