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Rental/Lease Agreement
A Residential Lease Agreement outlines the terms of a residential tenancy between a landlord and tenant.
Landlords and property managers use these documents every day to lease and maintain rental properties.
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Last Updated June 13, 2023
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As a landlord, renting out property can seem daunting when you have to use specific documents, follow landlord-tenant laws, and consider the tax implications for your rental income.
However, these challenges can be worth overcoming when you consider the financial rewards of renting out property. Having a rental income can set you up for success and offer you financial freedom in the future.
In this guide, we'll discuss Canadian landlord-tenant laws, landlord responsibilities and limitations, and hiring a property manager.
Landlord-tenant law refers to the various legislations that outline the rights and responsibilities of landlords and tenants involved in residential and commercial leases. Besides governing the actions of landlords and tenants during tenancies, these various legislations may also govern the rental application and screening process.
In Canada, provincial and territorial governments dictate landlord and tenant laws. Therefore, each province and territory has its own specific laws that govern residential and commercial tenancies.
For detailed information on the landlord and tenant legislation where you live, contact your provincial or territorial consumer affairs office.
Residential and commercial rental properties are similar in many ways. Both can be valuable investments that can appreciate and depreciate in value and provide you with helpful rental income.
However, different laws sometimes apply to residential and commercial tenancies. Additionally, local, provincial, and national building codes may differ between residential and commercial buildings.
Residential tenancies refer to situations in which a tenant is renting a private living area, such as a:
All Canadian provinces and territories, excluding Québec, have residential tenancy acts. These tenancy acts outline the rights and responsibilities that apply to landlords and tenants and include information regarding:
As a landlord, it is important to understand the rules that are specific to your rental property's location. To view the tenancy act for your province or territory, follow the appropriate link from the following list:
Québec does not have a residential tenancy act. Unlike all the other provinces and territories, which operate under common law, Québec follows the civil law tradition. Québec's residential tenancy laws and regulations are more specific than other provinces and territories.
Renting a property does not come without tasks and responsibilities. As a landlord, you can be proactive and stay ahead of the game. Still, unforeseen events that require your involvement are sure to happen.
In addition to always obeying your province's or territory's laws and complying with the terms of a tenant's lease, landlords must fulfill the following responsibilities:
It is vital that you provide safe and habitable housing to your tenants, both at the beginning and throughout their tenancy. Providing habitable housing includes:
An integral part of providing safe and habitable housing is meeting local, provincial or territorial, and national housing codes, such as the National Building Code of Canada 2015. Also, you need to make sure that your rental property obeys zoning by-laws, and meets fire-safety regulations before a tenant moves in.
In addition to providing habitable housing for your tenant, you must ensure that your tenants do not disrupt the neighbours. If your tenant is making lots of noise in your rental property, it is your responsibility to take steps towards fixing the issue.
Once a tenant has informed you of a repair problem that needs fixing, you must take care of the repair within a reasonable time frame.
If a repair problem is affecting your tenant's ability to live comfortably in the property, such as a non-working furnace, broken shower, or shattered window, you must deal with it quickly. Some repairs must be prioritized as soon as possible, such as issues to do with fire safety and mold.
Neglecting to complete a repair could allow a tenant to pursue an alternative solution, such as completing the repair themselves and withholding the repair costs from their rent payment.
Most landlords request that tenants provide a security deposit at the beginning of a tenancy. When a tenancy ends, landlords can use a security deposit to cover unforeseen expenses, such as the costs associated with tenant-caused damage.
In order to determine whether a tenant has caused damage, it is imperative that you record the condition of your rental property at the beginning and end of a tenancy. The best way to record your property's condition is by using a move-in and move-out inspection report. By having an inspection report, you can hold a tenant accountable for any damage they cause and prevent having to pay for repairs completely out of your own pocket.
As a landlord, you must respect and protect your tenant's privacy. Respecting a tenant's privacy means understanding that the rental unit is their home, despite you owning it. Therefore, you cannot come and go as you please. To enter the rental property, you must provide adequate notice.
Protecting your tenant's privacy means handling their personal information with care. Most times, being a landlord involves the collection of a tenant's personal information. It is your duty to prevent the inappropriate use of a tenant's personal information and not disclose it to third parties.
In most of Canada, landlords must comply with the Personal Information Protection and Electronic Documents Act (PIPEDA). PIPEDA outlines the rules for how businesses, including landlords, must handle others' personal information. According to PIPEDA, you must:
In British Columbia, Alberta and Quebec, there are provincial private sector laws that may apply to landlords instead of PIPEDA.
In Canada, there are tax implications for renting out real estate property. If you received income from renting out a property, you must file a statement of income and expenses.
To create a statement of income and expenses, the Government of Canada encourages landlords to use Form T776. This form allows you to enter and calculate your rental income, expenses, and any capital cost allowance (CCA) that applies.
Across Canada, tenants have many rights that limit the actions their landlords can take. Generally, as a landlord, you cannot:
Landlords cannot discriminate against tenants and applicants during residential and commercial tenancies. Federal and provincial laws prohibit landlords from discriminating against tenants and applicants based on certain grounds, including:
Tenant protections from discrimination are outlined in the Canadian Charter of Rights and Freedoms. In addition, each province and territory has a set of human rights laws that include protections in leasing situations:
Managing commercial spaces is not that different from managing residential spaces. Like with residential rental spaces, you should record all tenancies by creating commercial leases.
In terms of intended use, commercial properties have more variety than residential ones. Residential spaces are homes meant for living while commercial properties can be:
Local, provincial, and territorial jurisdictions may have varying health and safety guidelines for these different types of commercial spaces. In addition, commercial spaces are usually subjected to specific zoning bylaws. Therefore, when you own a commercial rental property, you need to have at least a basic understanding of your space and its property-specific regulations.
Some provinces, such as Ontario and British Columbia, have commercial tenancy acts that govern the leasing of business spaces. For more information about your province or territory, contact your provincial or territorial consumer affairs office.
During commercial tenancies, the responsibilities of landlords include:
In addition, you should continually upgrade and maintain your commercial space to attract long-term, quality tenants.
As a landlord, you can manage your rental property on your own or hire a property manager. When you hire a property manager, you pay them to keep your rental property occupied and deal with the renters.
Property managers have a wide range of responsibilities that can make your life as a landlord much easier. When you hire a property manager, you can work with them to determine their exact duties. You could have them be responsible for any or all of the following tasks:
There are many pros to hiring a property manager. As property management professionals, they stay informed on landlord-tenant laws. Additionally, if they work for a property management company, they may have access to valuable resources. For example, a property management company may have an established relationship with a contractor to deal with repairs.
As a landlord, you set yourself up for success by understanding the documents that you need, the relevant landlord-tenant laws, and the tax implications on rental income. When you take the time to learn about your obligations, you can prevent disagreements with your tenants and protect yourself from costly legal battles.
Whether you own a residential or commercial rental space, staying organized with the right documents will ensure a smoother and more enjoyable tenancy for everyone. When you create positive experiences for tenants, they are more likely to respect your property and renew their leases, ultimately creating less work for you.
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Whether you have a single tenant in your basement or manage an entire apartment building, these documents help you protect and manage your property.
Rental Inspection Report
A Rental Inspection Report records the condition of a rental property when a tenant moves in, and again when a tenant moves out.
Lease Amendment
A Lease Amendment is used to make changes to an existing lease (e.g. changing the permitted use of property or term length). The original lease remain...
Rent Receipt
A Rent Receipt is used to keep track of full or partial rent payments.
Lease Assignment Agreement
A Lease Assignment Agreement is used when a tenant wishes to transfer the entire interest that they have in the property to a third party. The third p...
Notice To Enter
A Notice to Enter is a written letter informing the tenant that the landlord or property manager will be entering the property in the near future.
Rent Increase Notice
A Rent Increase Notice is used to inform a tenant of a future increase to their rent payment.
Offer to Lease
An Offer to Lease states your intent to rent commercial property to a landlord or property manager.
Landlord's Consent to Lease Assignment
A Landlord's Consent to Lease Assignment is a form of written permission provided by the landlord in order for the original tenant to transfer all rig...