08/06/2025
New Rental Renovation Licence By-law Coming into Effect
The new Rental Renovation Licence By-law will come into effect within the City of Toronto on July 31, 2025. The by-law requires landlords to obtain a licence before starting repairs or renovations that require tenants to move out of their rental units under the Provincial N13 process (under the Residential Tenancies Act).
To obtain a licence, owners and operators (i.e. landlords) must comply with the by-law requirements, including notifying tenants of the licence application, making arrangements for the tenant’s temporary alternate accommodation during the renovation period or paying monthly rent-gap compensation if the tenant is returning to the unit, or paying compensation if the tenant chooses not to return.
When renovating a tenanted unit that requires it to be vacant, landlords must hire a qualified professional, licensed under the Ontario Association of Architects or Professional Engineers Ontario, to confirm that vacant possession is necessary. Landlords must then pay a $700 application fee within seven days of issuing an N13 legal notice to the tenant.
If a qualified professional verifies that the unit must be vacated during renovations, landlords must provide:
Tenants wishing to return with either temporary, comparable housing at similar rents or monthly rent-gap payments.
Tenants choosing not to return with severance compensation equal to three months of rent-gap payments.
Tenants a one-time moving allowance of $1,500 for a studio or one-bedroom unit or $2,500 for a two-or-more bedroom unit.
These requirements do not apply to renovations that do not require the unit to be vacant.
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