Its official ! courtesy of the FRPO ( Federation of Rental-Housing Providers of Ontario), the 2012 guideline is 3.1%.
Each year the Ontario government via the Ministry of Municipal Affairs and Housing announces the province’s rent increase guideline for the following year. The formula used to arrive at the annual rent increase guideline is based on the Ontario Consumer Price Index (CPI). The Consumer Price Index is released monthly by Statistics Canada and is widely regarded as a reliable and objective measure of inflation.
The 2012 rent increase guideline is calculated by averaging the percentage change in the Ontario Consumer Price Index during the previous 12 months from June 2010 to May 2011.
Increasing Your Rent by the Guideline – Landlord and/or Tenant Requirements
The rent for a unit can be increased up to the guideline limit if at least 12 months have passed since a tenant first moved in, or if at least 12 months have passed since the last rent increase. In addition the landlord must provide at least 90 days notice to tenants prior to effecting a rent increase.
Changes to Extraordinary Operating Costs Increase
- There will be a change to the threshold for what qualifies for an extraordinary operating cost increase in 2012. According to the regulations, “an increase in the cost of municipal taxes and charges or utilities is extraordinary if it is greater than the guideline plus 50 percent of the guideline”. That means that the threshold for extraordinary operating costs will be 4.65% for 2012.
Changes to interest rate on last month’s rent deposits
- The interest rate on last month’s rent deposits also changes in accordance with the Residential Tenancies Act which requires interest to be paid to the tenant annually at a rate equal to the guideline. The interest rate on last month’s rent (LMR) deposits for 2012 will be 3.1%.
Managing with head and heart♥