Understanding Your Lease Agreement: A Guide for the Ontario Standard Lease

Insights for Owners and Tenants
This series provides valuable tips and insights for both property owners and tenants to enhance their living and management experiences.

Navigating the world of renting can be daunting, especially when it comes to understanding your lease agreement. In Ontario, the Standard Lease is designed to simplify and clarify the rental process for both landlords and tenants. This guide breaks down the Ontario Standard Lease, highlighting its benefits for both property owners and renters.

For Landlords: Why Use the Ontario Standard Lease?

As a property owner, the Ontario Standard Lease offers several advantages to help streamline and safeguard your rental process:

• Standardized and Fair: Ensures your rental agreements follow Ontario’s legal guidelines, reducing the likelihood of disputes and misunderstandings.
• Transparent: The clear terms laid out in the Standard Lease build trust with tenants by providing a transparent and easy-to-understand contract.
• Legally Compliant: Using the Standard Lease guarantees that your rental agreement adheres to the Residential Tenancies Act (RTA), helping you avoid unintentional violations of tenants’ rights.
• Easy to Understand: Written in plain language, the Standard Lease is accessible to both you and your tenants, reducing the need for costly legal consultations and misunderstandings.

What Landlords Must Include in the Standard Lease:

• Names and Addresses: Ensure both your contact information and the tenant’s are included.
• Rental Unit Description: Provide a clear description of the rental property.
• Term: The lease length can vary, and there’s no minimum or maximum duration. Lease agreements automatically renew on a month-to-month basis after the term ends, unless otherwise stated.
• Rent Details: Clearly state the amount of rent, when it’s due, and the acceptable payment methods.
• Services and Utilities: List which utilities and services are included in the rent and which are the tenant’s responsibility.
• Security Deposits: Remember that you can only request the Last Month’s Rent (LMR) and key deposits. Damage deposits are not allowed under the RTA.
• Rules and Responsibilities: Specify important rules, such as no-smoking policies, pet policies, and maintenance obligations for both parties.

Additional Terms and Appendices

You can include additional terms in the lease through appendices, as long as they don’t conflict with the Residential Tenancies Act (RTA). For example, an appendix might detail how utilities are billed or outline specific tenant maintenance responsibilities.

What Happens if Tenants Request a Standard Lease?

If a tenant is entitled to the Standard Lease but hasn’t received one, they can request it in writing. You must provide the lease within 21 calendar days of receiving the request. If you don’t provide it within that time, the tenant can legally withhold one month’s rent. Should you still fail to provide the lease 30 days after the rent has been withheld, the tenant is entitled to keep the withheld rent.

Changes to the Lease

Any changes to the lease terms, such as changes to smoking policies or new building rules, must be agreed upon in writing by both you and the tenant. This ensures that both parties understand and consent to the new terms.

For Tenants: Understanding the Ontario Standard Lease

As a tenant, the Ontario Standard Lease provides clarity and protection when entering into a rental agreement. Here’s what you need to know to ensure your rights are protected:

What Tenants Should Look for in the Standard Lease:

• Names and Addresses: Verify that both your name and the landlord’s contact details are correct.
• Rental Unit Description: Ensure the lease accurately describes the rental unit.
• Lease Term: The length of the lease can vary, and it will automatically renew on a month-to-month basis unless otherwise stated.
• Rent: Understand how much rent you owe, when it’s due, and how to pay it.
• Services and Utilities: Be clear about which utilities are included in the rent and which you’re responsible for.
• Security Deposits: Your landlord can only request a deposit for Last Month’s Rent (LMR) and a key deposit. Damage deposits are not permitted.
• Rules and Responsibilities: Familiarize yourself with any specific rules, such as no smoking or pet policies, and understand your maintenance responsibilities.

Requesting a Standard Lease

If your landlord doesn’t provide a Standard Lease, you can request it in writing. Once requested, the landlord has 21 days to provide the lease. If they fail to do so, you have the right to withhold one month’s rent. Should the landlord still not provide the lease 30 days after you’ve withheld rent, you are entitled to keep the withheld rent.

What Happens if the Property Changes Ownership?

If your rental property is sold or changes ownership, the terms of your existing lease remain in effect. The new landlord must honor the lease and the rights you have under it.

Understanding Deposits

Landlords in Ontario are only allowed to request deposits for Last Month’s Rent and for keys, if applicable. Any other deposit, such as a damage deposit, is not legal under the RTA. This regulation helps ensure that you aren’t burdened with unnecessary upfront costs when securing a rental unit.

Utility Costs

Your lease should clearly state which utility costs are included in the rent and which you are responsible for paying. Transparency on this issue helps avoid disputes later on and ensures you understand your financial responsibilities from the start.

Conclusion: The Benefits for Both Landlords and Tenants

The Ontario Standard Lease is designed to make the rental process fair, transparent, and legally compliant for both landlords and tenants. For landlords, it offers peace of mind by ensuring legal compliance and clear communication with tenants. For tenants, it provides protection through standardized terms and clarity on your rights and obligations.

Whether you’re a tenant or landlord, staying informed and proactive is the key to a smooth and positive rental experience. If you have any doubts or need advice about your lease agreement, don’t hesitate to seek clarification or legal assistance. The Ontario Standard Lease helps both parties navigate the rental process with confidence and peace of mind.