As the academic year draws to a close and the warmth of early summer settles over Ontario, the rental market experiences a unique transition. While some students may be departing, others are securing housing for summer programs, co-op placements, or the upcoming fall semester. This period presents opportunities for property owners in the student housing sector. Landlords must remain well-versed in their rights and responsibilities under Ontario law to ensure smooth tenancies and avoid potential pitfalls.
Understanding the Residential Tenancies Act
The cornerstone of landlord-tenant law in Ontario is the Residential Tenancies Act. This comprehensive legislation governs most residential tenancies in the province, including those involving university students. It outlines the rights and obligations of both landlords and tenants concerning matters such as lease agreements, rent, repairs, and eviction. It is crucial for landlords to have a thorough understanding of the Act to ensure compliance and protect their interests.
One of the fundamental aspects of the Residential Tenancies Act is the requirement for a written tenancy agreement. While oral agreements can be legally binding, a written agreement provides clarity and helps prevent misunderstandings. The standard form of lease, as mandated by the Ontario government for most residential tenancies, must be used. This standardized form outlines essential terms such as the landlord’s and tenant’s names, the rental unit’s address, the rent amount and due date, and the tenancy period. Landlords can include additional terms in the lease, provided they do not conflict with the Act. For example, clauses regarding maintenance responsibilities beyond what is legally required or restrictions on guests that unduly infringe on the tenant’s reasonable enjoyment of the premises are likely unenforceable.
Fixed-Term vs. Month-to-Month Tenancies
Leases with university students often take the form of fixed-term tenancies, typically aligning with the academic year (e.g., September to April). Under the Residential Tenancies Act, a fixed-term tenancy automatically becomes a month-to-month tenancy upon expiry unless the landlord and tenant agree to a new fixed-term agreement. Landlords cannot require a tenant to enter into a new fixed-term agreement. In most situations, the tenant or landlord must inform the other party of their intention to terminate a lease at least 60 days before the end of the term.
Rent and Associated Financial Considerations
The Residential Tenancies Act strictly regulates rent increases in Ontario. Landlords can only increase rent once every 12 months and must provide tenants with at least 90 days’ written notice using the prescribed form. The amount of the rent increase is subject to the annual guideline set by the Ontario government. There are limited exceptions to this rule, such as with the approval of the Landlord and Tenant Board for significant capital expenditures. Landlords should be aware that charging illegal rent or failing to follow the proper procedures for rent increases can result in penalties.
The Act also governs security deposits. Landlords can only request a security deposit equivalent to one month’s rent, and this deposit must be used solely to cover the cost of damages to the rental unit beyond normal wear and tear. Upon the termination of the tenancy, the landlord must return the security deposit to the tenant with any accrued interest, provided there are no valid claims for damages. The Board typically adjudicates disputes regarding security deposits.
Maintaining the Premises and Addressing Repairs
Landlords have a legal responsibility under the Residential Tenancies Act to maintain the rental property in a good state of repair and fit for habitation. This includes ensuring essential services such as heat, water, and electricity function properly. Tenants are responsible for keeping their unit reasonably clean and for any damage they or their guests cause, beyond normal wear and tear.
When repairs are needed, tenants should notify the landlord in writing. Landlords are expected to address necessary repairs within a reasonable timeframe. If a landlord fails to fulfill their maintenance obligations, tenants have several recourses under the Act, including applying to the Landlord and Tenant Board for an order compelling the landlord to make repairs or even terminating the tenancy in certain circumstances. Conversely, if a tenant causes damage to the property, the landlord can seek compensation from the tenant, potentially through an application to the Board.
Navigating Eviction Procedures
Evicting a tenant in Ontario is a legal process governed strictly by the Residential Tenancies Act. Landlords cannot simply lock a tenant out or seize their belongings. The Act outlines specific grounds for eviction, such as non-payment of rent, causing damage to the property, illegal acts, or interfering with the reasonable enjoyment of other tenants or the landlord.
For each ground of eviction, the Act prescribes specific procedures that landlords must follow, including serving the tenant with the correct notice of termination. The length of the notice period varies depending on the reason for eviction. For example, a notice for non-payment of rent can be as short as 14 days. After the notice period expires, if the tenant has not vacated the premises, the landlord must apply to the Landlord and Tenant Board for an eviction order. The Board holds hearings where the landlord and the tenant can present their case. Only with a valid eviction order from the Board can a landlord legally evict a tenant, typically with the assistance of the Sheriff. Attempting to evict a tenant without a Board order is illegal and can result in significant penalties for the landlord.
Addressing Unique Considerations for Student Tenancies
While the Residential Tenancies Act applies to all residential tenancies, some unique considerations arise when dealing with student tenants.
Joint and Several Liability
Often, several students will rent a property together, leading to questions about joint and several liability. In a standard lease agreement with multiple tenants, each tenant is typically jointly and severally liable for the entire rent and any damages. This means that the landlord can pursue any one or all of the tenants for the full amount owed, regardless of how they have divided the responsibility amongst themselves. Landlords should ensure that the lease agreement clearly outlines this liability.
Subletting and Assignments
Another common issue involves subletting and assignment. Students may wish to sublet their unit if they leave for a co-op placement, a new summer work location, or return home for the summer. Under the Residential Tenancies Act, tenants generally have the right to assign their tenancy agreement to another person with the landlord’s consent, which cannot be unreasonably withheld. If a landlord unreasonably withholds consent, the tenant can terminate the tenancy with 30 days’ notice. Subletting, where the original tenant moves out temporarily and intends to return, also requires the landlord’s consent. Landlords should have clear policies regarding subletting and assignment outlined in the lease agreement, consistent with the provisions of the Act.
Parental Guarantees
Parental guarantees are also frequently used in student tenancies. Landlords may require parents to guarantee the lease obligations of their student children. These guarantees can provide an added layer of financial security for the landlord. However, the enforceability of such guarantees depends on their specific wording and the principles of contract law. It is advisable for landlords to have these guarantees drafted by legal professionals to ensure their validity.
Proactive Legal Strategies for Successful Student Tenancies
Leasing to university students in Ontario presents both opportunities and challenges. A thorough understanding of the Residential Tenancies Act, coupled with proactive legal strategies, is essential for landlords to navigate this market successfully. By utilizing the standard form of lease, clearly outlining the tenancy terms, adhering to the rules regarding rent increases and security deposits, fulfilling maintenance obligations, and following proper eviction procedures when necessary, landlords can minimize legal risks and foster positive landlord-tenant relationships.
It is also crucial to address the unique considerations of student tenancies, such as joint and several liability, subletting and assignment, and parental guarantees, with clear and legally sound documentation.
Contact Bader Law for Top-Tier Real Estate Advice in Mississauga & Oakville
The skilled real estate lawyers of Bader Law provide comprehensive legal advice and representation to landlords in Ontario. We draft legally sound lease agreements, navigate the complexities of the Residential Tenancies Act, and represent clients before the Landlord and Tenant Board. We help landlords comply with the law and protect their investments in the dynamic student housing market. To discuss your real estate matter with our firm, please contact us online or call (289) 652-9092.