Email this pageAbove Guideline Increases – Utilities
A tenant’s rent can be raised by an above guideline rent increase for higher utility costs.
A landlord is only able to claim an extraordinary increase in utility costs. An extraordinary increase in utility costs means a cost increase greater than the guideline plus 50% of the guideline
For example, if the guideline is 2%, a landlord can only claim a utility cost increase that is higher than 3%.
When a tenant’s rent is increased because of higher utility costs, if the utility costs later decrease, the tenant’s rent will be reduced accordingly.
For example, if a $10,000 extraordinary increase in utility costs resulted in a 2% above guideline rent increase for the tenant, if the utility costs later decrease by $10,000, the tenant will get a 2% rent reduction.
After receiving an above guideline increase for utilities, for each of the next 5 years a landlord is required to share information about utility costs with the tenant each year. If utility costs decrease during this time, the landlord has to reduce the tenant’s rent.
Note: An above guideline increase is an increase above the annual rent increase guideline. Landlords can apply for this type of increase if their costs have increased due to:
- Extraordinary increases in municipal taxes and charges or utilities
- Capital expenditures such as roof replacement
- Operating costs related to security services