Subject: 2007 Market Rent Index Release
Legislation/Regulation Release 06-06
Operational
A new regulation amending Ontario Regulation 339/01 Section 28 was filed on September 26, 2006.
Consultation with service managers and other stakeholder organizations led to a proposed change to the calculation of the market rent index for Section 103 projects. This change is intended to give more local discretion, provide greater clarity and consistency in the regulation and ease administrative requirements.
The changes became effective upon filing.
Summary of Changes:
Market Rent Index Calculation for Section 103 Projects
- Section 28 of Ontario Regulation 339/01 was amended to simplify the data gathering and subsequent calculations required for the market rent index calculation.
- The market rent index described in Ontario Regulation 339/01 Section 28 is now calculated as the lesser of the Rent Control Guideline and the change in local average rents as reported by the Canadian Mortgage and Housing Corporation (CMHC) in its annual Rental Market Report.
- Please see Attachment A for a copy of the amended regulation. This updated regulation is available on e-laws ( www.e-laws.gov.on.ca ).
Development of the “2007 Market Rent Index Table” - Background
- The ministry has prepared a table of market rent indices applicable to each CA, CMA and zone (where available) for both the “apartment” and “row (townhouse)” building categories.
- The average rents reported by the CMHC are gathered on the basis of district and building type:
a. District: CMHC reports average rents by census metropolitan area centre (CMA), census agglomeration area centre (CA) and zones (where available).
b. Building type: CMHC reports average rents by either the apartment category or the row (townhouse) category.
How the “2007 Market Rent Index Table” was Populated
- If rents are declining in an area, a negative market rent index is replaced by 0% (equivalent to a factor of 1).
- If data for the local average rent is not available, the missing data is replaced with the Rent Control Guideline.
- The final figure for the 2007 market rent index is the lesser of the Rent Control Guideline and the percentage change in the local average rent.
Using the “2007 Market Rent Index Table” to Identify Applicable MRI
- The ministry has provided the final 2007 market rent index for all service managers in the “2007 Market Rent Index Table.”
- Service managers can disseminate the 2007 Market Rent Index Table for use by housing providers effective immediately.
- Service managers will identify the applicable market rent index for the respective service area, according to the CA, CMA and zones provided in the 2007 Market Rent Index Table.
- The applicable CA, CMA or zone for apartments or row (townhouses) will be selected by the service managers from either:
- The CA, CMA or zone encompassing the service area in question, or
- The CA, CMA or zone that is closest to the service area in question, as identified by the service manager.
- The final 2007 market rent index can be identified in the highlighted columns titled:
- Row (Townhouse)” 2007 Final Market Rent Index
- “Apartment” 2007 Final Market Rent Index
- Please see Attachment B for the complete 2007 market rent index listings by district and by building type.
For more information please contact the ministry.
Chris Loreto
Telephone: 416-585-6562
E-mail: chris.loreto@ontario.ca
Randy Hodge
Director
Facilitation Branch
Att:
Attachment A – Amending O. Reg. 339/01
Attachment B – 2007 Market Rent Index
October 13, 2006