If you’re renting in Ontario, you may have heard of an “above-guideline rent increase” (AGI). With rental costs rising, it’s more important than ever to understand your rights if your landlord asks for more than the standard increase. This guide will explain how AGIs work, when and why landlords can apply for them, and what you can do as a tenant to protect your housing costs.

What Are Above-Guideline Rent Increases?

Ontario sets an annual rent increase guideline, capping how much most landlords can legally raise rents. For 2024, this limit is 2.5%. However, landlords can ask the Landlord and Tenant Board of Ontario (LTB) to approve a higher increase in certain situations. This is called an “above-guideline increase” (AGI).

Common Reasons for an AGI Application

• Significant capital repairs or renovations (e.g., replaced boiler, roof, windows)
• Municipal taxes and charges have increased substantially
• Additional increases in utility costs, but only if paid by the landlord

Landlords must apply to the LTB— they cannot just increase your rent above the guideline without this approval. It’s your right as a tenant to review the application and participate in the process.

How Above-Guideline Rent Increases Work

The Landlord and Tenant Board of Ontario decides if an AGI is justified. The board will schedule a hearing where both you and your landlord can present evidence or arguments. Until the LTB gives a decision, your landlord can only raise your rent by the regular guideline amount.

Notice Requirements and Timing

• A landlord must serve you an official written notice (Form N1) at least 90 days before the increase date.
• If seeking an AGI, the landlord also files Form L5: Application for an Above Guideline Increase with the LTB.
• The process usually involves a hearing where tenants can provide their input or objections.

Always check the details and calculations in your AGI notice. You have a right to ask your landlord for supporting documentation and attend the LTB hearing to raise your concerns.

Responding to an AGI Notice

If you get a notice for an above-guideline rent increase, review it carefully. You do not have to immediately accept the new rent. As a tenant, you can:

• Ask your landlord for copies of invoices, receipts, or city tax statements that justify the increase
• File a Response to an LTB Application (by written submission or at the hearing)
• Attend the hearing to make your case (you can bring relevant documents, photos, or witnesses)
• Consult the Tenant Rights in Ontario page for a broad overview of your legal protections and procedures

If you believe the increase is not justified, you have the right to challenge the application at the LTB. Many tenants successfully reduce or defeat AGIs by participating in the hearing process.

Relevant Forms and Official Resources

• Form N1 – Notice of Rent Increase: This is the standard form for notifying tenants of any rent increase, including an AGI. Download Form N1 from the LTB
• Form L5 – Application for an Above Guideline Increase: Used by landlords to formally apply to the LTB for permission to raise rent above the guideline. View Form L5 here
• You may also want to review the Residential Tenancies Act, 2006 for the legal framework (see Sections 126–127).

For more details about how and when rent can be increased in general, check Understanding Rent Increases: What Tenants Need to Know.

What If Repairs Weren’t Completed Properly?

Capital repairs are the most common reason for AGIs. If you believe the repairs were unnecessary or not completed properly, you can raise this at your LTB hearing. Documentation (like photos, repair records, or third-party assessments) is helpful. If major repairs impact your living conditions or health, also see Health and Safety Issues Every Tenant Should Know When Renting.

Your Rights and Next Steps

It’s your right to:

• Receive proper notice and documentation
• Object to unfair or unnecessary AGIs
• Attend LTB hearings and present your evidence
• Appeal the decision if you disagree with the outcome

Find rental homes across Canada on Houseme if you need to compare your current rent with other available listings in your city.

FAQ: Ontario Above-Guideline Rent Increases

1. What is the maximum annual rent increase in Ontario?
   The 2024 rent increase guideline is 2.5%. Landlords must apply for approval to increase rent above this amount.
2. How do I challenge an above-guideline rent increase?
   Attend the LTB hearing, present your evidence, and ask questions about the landlord’s documentation.
3. If I lose at the LTB, do I have to pay the higher rent right away?
   No, the new rent applies only if the LTB approves the landlord’s AGI application. You must then pay the new rate from the date ordered by the LTB.
4. What are capital expenditures for AGI purposes?
   These are major repairs or replacements that improve the building, not routine maintenance.
5. Where can I find my general rights as an Ontario tenant?
   Visit Tenant Rights in Ontario for a detailed summary of rights, laws, and contacts.

Key Takeaways for Ontario Tenants

• Above-guideline rent increases (AGIs) require LTB approval and are for exceptional costs, not routine repairs.
• You always have the right to attend the hearing, object, and present evidence.
• Review every notice carefully—protect your budget by understanding when and why you must pay more.

AGIs are rare but impactful. Knowing your rights helps you respond confidently.

Need Help? Resources for Tenants

• Landlord and Tenant Board of Ontario (LTB): Filing forms, hearing schedules, and rent increase applications
• Ontario Government: Renting in Ontario – Your Rights
• Community Legal Clinics in Ontario: Find your local clinic
• For a full overview of laws and rights, consult Tenant Rights in Ontario

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1. Residential Tenancies Act, 2006
2. Landlord and Tenant Board of Ontario
3. Ontario Rent Increase Guideline 2024

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