Ontario Rent Increase Guideline 2026: 2.1% Max

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The short version

The guideline is a ceiling, not a target. A landlord may raise rent by less than 2.1%, or not at all — but on a guideline-covered unit, anything above 2.1% in 2026 needs LTB approval first. By law the guideline itself can never exceed 2.5%, no matter how high inflation runs, because it is based on the Ontario Consumer Price Index and capped by statute.

The dollar math at 2.1%

Multiply your current monthly rent by 0.021. That is the maximum monthly increase for 2026:

So a $2,000 rent becomes $2,042, and a $2,500 rent becomes $2,552.50. Over a full year, the $2,000 example costs an extra $504. Compare that with 2025, when the same $2,000 rent could rise by 2.5%, or $50 a month: the 2026 guideline saves that tenant $8 a month, or $96 a year, versus last year's ceiling.

Three rules that make an increase legal

A number inside the guideline is not enough on its own. All three of these must hold:

1. Form N1. The landlord must use the LTB's official Form N1, Notice of Rent Increase. A text, an email or a casual letter is not a valid rent increase notice.
2. At least 90 days' written notice. The notice must reach the tenant at least 90 days before the increase takes effect. A notice that is short on time is generally not valid.
3. Once every 12 months. At least 12 months must have passed since the last increase or since the tenancy began. Signing a new lease does not reset the clock.

If any one of these fails, the increase is generally not enforceable, and a tenant who paid an improper increase generally has up to 12 months to dispute it at the LTB. Check the form, the date and the percentage before you pay the new amount.

The exemption: units first occupied after November 15, 2018

The 2.1% cap does not cover every unit. Units first occupied for residential purposes after November 15, 2018 — generally newer buildings, additions and most new basement apartments — are exempt from the guideline. In those units a landlord can propose a larger increase.

Exempt does not mean unregulated. The other rules still apply in full: only once every 12 months, and at least 90 days' written notice on the proper LTB form. And rent control follows the tenancy, not the unit: when a tenant moves out, the landlord and a new tenant can negotiate a fresh starting rent, guideline or not.

Before you sign a lease, ask when the unit was first occupied. That one date decides whether the 2.1% cap protects you.

Above-guideline increases: the LTB must approve first

For a guideline-covered unit, a landlord who wants more than 2.1% must apply to the LTB for an above-guideline increase (AGI) on Form L5 and get an order. The limited grounds include major capital expenditures, such as a new roof or elevator, and a large increase in municipal taxes or operating costs. The landlord must make the case, and tenants get notice and a chance to respond at a hearing. Until the LTB approves, the landlord cannot lawfully charge above the guideline.

Recent guidelines, and a look at 2027

• 2027: 1.9% — for increases taking effect on or after January 1, 2027. On a $2,000 rent that adds $38, for $2,038.
• 2026: 2.1% — this article's figure.
• 2025, 2024, 2023: 2.5% each year — the statutory cap, held for three straight years while inflation ran higher.
• 2022: 1.2%; 2021: 0% (provincial rent freeze).

The calendar year of the effective date decides which guideline applies: an increase effective December 1, 2026 uses 2.1%, while one effective January 1, 2027 uses 1.9%.

Tenant checklist when a notice arrives

1. Is the unit covered? First occupied on or before November 15, 2018 means the 2.1% cap applies; after that date, it generally does not.
2. Is it Form N1, with 90 days? Count the days from delivery to the effective date.
3. Has 12 months passed? Check the last increase date, not the lease renewal date.
4. Do the math. Current rent × 0.021 is the 2026 maximum for a covered unit. If the notice is higher and there is no LTB order, raise it with the LTB.

Sources

• Government of Ontario — Residential rent increases (official guideline page)
• Settlement.org — How often can a landlord increase the rent? (2026: 2.1%, 2027: 1.9%, 90 days, 12 months)
• Keystead — Ontario Rent Increase Guideline 2026 & 2027 (2.1% and 1.9%, Nov 15, 2018 exemption, N1, 90 days)
• JSR Legals — Ontario's 2026 Rent Increase Guideline (2.1%, 2.5% cap, Form N1, above-guideline increases)

Educational content only — not financial advice. Figures are estimates; confirm your own situation with the CRA or a licensed financial advisor. See our Disclaimer.