Tenancy Agreements – The New Standardised Lease Form

The new standard form of lease is now mandatory for use with most residential tenancies in Ontario. To avoid confusion right away, the new form carries the date (2020/12) and can be downloaded here. Filling it is pretty straight forward, but if you are uncertain, seek legal help. Most paralegals will be happy to assist.

The new form makes the process more streamlined for both landlord and tenant. The document tries to make all provisions easy to read and clear to both parties. Room for interpretation is generally removed so it provides for more legal clarity. For example, it is now much harder to include provisions that contradict the Residential Tenancies Act, thus reducing possible confusion and void clauses.
One of the goals for introducing the standard lease was to make sure, landlords and renters understand their rights and responsibilities, and to reduce the need for Landlord and Tenant Board hearings to resolve disputes. We will have to see in how far that becomes a reality. The form is for use with single family homes, apartment buildings, condominiums and secondary units (e.g. basement apartments).

Topics such as rent discounts, rent deposit, key deposit, services & utilities, smoking etc are all covered in the form. This will help you to specify items that are included in the rent, e.g. parking, storage, utilities, AC etc. It also sets out the other parameters you are working within. Use the opportunity to go through every section with the new tenant, firming up the common understanding of the lease. Hopefully, this discussion will help to reduce the chance of future issues.

Use the below guide for further reference.

Operating Expenses

What’s going on with Home Insurance? Multi-Residential Investment Properties

If you bought a new investment property in the last 12 months or so, you may have been surprised at the insurance premiums. They are at an extremely high level at the moment, even existing investment property owners have seen higher rates pushed on them. An increase of 25% is not uncommon. There are many factors at play, ranging from higher property values to climate change related extreme weather events.
More details on those factors can be found in this article here: Why Are Insurance Premiums Going Up?

The issue for the investor when buying a property is, that you cannot rely on the amount of the premium that the current owner is paying. If their premium is $2500, be aware that yours can easily be $3500, which goes right down to your bottom line. At a Net Operating Income of $20k, this is a hefty reduction of 5%. The effect on Net Cashflow is naturally even greater, if you are planning on pulling out $5k, now it's only 4. Which some of the other costs increasing as well, this can quickly put you under water. Needless to say, important to do your due diligence for all operating costs.

When looking at insurance providers, the obvious choice would be to work with a broker. They can assist a great deal and solicit quotes from a variety of insurers. However, most brokers do not have access to all providers, they tend to work with a specified group of insurers. There are also insurance companies that only write direct and do not go through brokers. Contact those directly for quotes.
A list of them is here: Direct Writers

Subletting and Assignments – Can the Tenant do that?

Subletting and assignment of a tenancy are terms that are often confused. Here are some of the ins and outs for both of them. Sublets are much more prevalent in Ontario, so I will mostly focus on those.


Under a sublet, the tenant allows another person to take over the use of the unit on a temporary basis. The original tenant plans to return. Consent of the landlord has to be sought. Situations with multiple tenants or roommates are generally not considered sublets. When submitting, the original tenant continues to be liable for the rental unit and remains the main contact for the landlord. The landlord continues to collect the rent from the original tenant. Taking rent from the sub tenant could be seen as establishing a direct tenancy between the landlord and the sub tenant, opening the door to a plethora of problems.

While the tenant must obtain the landlords consent to the sublet, the landlord cannot arbitrarily withhold their consent. Once consent is obtained, the subtenant has the right to occupy the unit up until the specified end date, giving the original tenant the right to take back occupancy on that date. Since the original tenancy agreement will stay in effect, any possible notices from the landlord will have to go to the original tenant (not the subtenant). It is advisable that the landlord make sure the tenant and subtenant sign a written subtenancy agreement with a clear termination date (move back date). Best practice would be for the landlord to refuse the subtenancy unless such an agreement is in place.

For further info see Section 97 of the RTA.


Rental Assignments

An assignment means that all rights and responsibilities of the tenancy are being transferred to a new tenant. In other words, the whole agreement is transferred to a different person and the original tenant gives up their rights and responsibilities regarding the rental unit. The landlord has seven days to respond to such a request by the tenant. You can refuse the assignment as such or you can refuse the potential new tenant, if you deem them unsuited.

Consult Section 95 RTA for more details.


The tenant left behind their belongings – What now?

There are four different scenarios for you to distinguish when it comes to tenant belongings that were left behind.

1. The tenant has vacated based on a notice

This scenario includes a notice that they received from the landlord, e.g. (N4, N5 etc.), the tenant notice given to the landlord (N9), a mutual agreement (N11) or an order of termination by the LTB.

There are belongings on the premises, the question now becomes whether it is clear that the tenant has moved out. Once it is clear you are allowed to sell, keep or dispose of the belongings. But how can you be sure that the tenant vacated the unit? The following indicators will help you determine:

  • Are the keys returned / left in mailbox?
  • Did anybody witness them moving out?
  • Did you receive their email or text message saying they are leaving
  • Were the utilities disconnected?

If you are not sure, it is advisable going through an eviction process via L2.

2. The tenant is evicted by the sheriff

Once the eviction is completed, the landlord has to give the tenant 72 hours to collect her belongings. Those must be available to the tenant between the daily hours of 8 AM - 8 PM. Best practice would be to coordinate the pick up time with the tenant. After the lapse of the 72 hours the landlord can sell, keep or dispose.

3. The tenant abandons the unit

There is no agreement or notice to end to the tenancy, nor an LTB order. The tenant is in arrears and vacated the rental unit. If the rent is still being paid, the unit cannot be considered abandoned. Other factors to determine whether you are dealing with abandonment are:

  • Did they inform anybody of their move or did somebody witness them moving out?
  • Is the mail being picked up?
  • Are the utilities disconnected?

If you are uncertain, it is once again recommended to follow the L2 proceedings. Once you have confirmed abandonment, there are two possible options for you in dealing with the belongings. Either you apply for termination with the LTB based on abandonment (L2), or you give notice to the tenant as well as the LTB that the belongings will be disposed of if not picked up within 30 days. If the tenant gets in touch with you and comes out to pick up their belongings, you can request for them to pay any outstanding rent (as well as incurred out of pocket expenses).

4. The tenant has died
The RTA provides that a tenancy terminates 30 days after the death of a tenant. A surviving spouse can remain in the unit as a tenant. The landlord has to leave the belongings in the unit for the 30 day period. You need to provide reasonable access for an executor or family member to remove the belongings. After 30 days you can sell, keep or dispose of the belongings. There is a six-month period within which the tenant's family can claim back the belongings or any sales proceeds.

Much more detail on all these cases is provided on the LTB website:

LTB: Brochures

Landlord Forms

When things go really bad with your tenants – Form N7

As some of the other landlord forms, the N7 has its challenges. In general, the form is there to end a tenancy for causing serious problems in the rental unit or residential complex. But what does that include?

Whenever a tenant has caused damage at your property, you generally are looking at using Form N5. You would only use Form N7 in much more serious cases. The specificity of the N7 is that it requires you to prove that the tenant has willfully caused the damage, which can be a difficult task.

There are other uses of the form as well. In the "Reason"- section of the form, you can choose one of the other three:

  • The safety of others in the property has been severely jeopardized by the tenant
  • The tenant has used the rental unit in a manner inconsistent with its use as residential premises and this has caused or can be expected to cause serious damage
  • You as the landlord live at the property and the tenant has substantially interfered with your reasonable enjoyment. This only applies to properties with 3 units or less.

Fill all your information chronologically in the form, making your case founded and clear. Serve the form properly (hand, under door, mailbox) and use form L2 (if needed) for eviction. The L2 can be filed right after serving the N7, not waiting period.

Find the full instructions for filling the form here: N7 Instructions.pdf