Understanding Lease Agreements

Lease agreements can feel like a mountain of fine print — but whether you’re a seasoned landlord or a first-time renter in Ontario, understanding what’s in your lease is essential. It’s not just paperwork; it’s your legal safety net.

Let’s walk through what you need to know, especially if you’re renting or managing property in Hamilton or Niagara.

What Is a Lease Agreement?

A lease agreement is a legal contract between a landlord and a tenant. In Ontario, this agreement outlines the terms of the rental, including how long the tenant can stay, how much rent they’ll pay, and what rules apply to the property.

Ontario mandates the use of a Standard Lease Form for most private residential rental agreements. This is designed to make leases easier to understand and more consistent across the province. If your lease doesn’t use this form — that’s already a red flag.

Key Components of a Lease Agreement

Whether you’re handing over keys or signing your first rental, here’s what must be in a solid lease agreement in Ontario:

• Full names of all tenants and the landlord
• Monthly rent amount and when it’s due
• Length of tenancy (e.g., 1 year, month-to-month)
• Who pays which utilities
• Rules about pets, smoking, and parking
• Responsibilities for maintenance and repairs

Remember, if it’s not written down — it’s not enforceable.

Legal Requirements in Ontario

In Ontario, it’s not just best practice — it’s the law to use the standard lease form for most rental units. Plus:

• Landlords can only request first and last month’s rent. No security deposits allowed.
• You can’t include illegal clauses like “no guests allowed” or “non-refundable deposits.”
• The lease must be in writing and a copy must be given to the tenant within 21 days.

If you skip these steps, you risk having your lease unenforceable or being penalized by the LTB.

What to Watch Out For

Here’s what to keep your eyes peeled for — whether you’re renting or managing:

• Vague or missing terms (e.g., “tenant handles repairs” without clarity)
• Verbal agreements with no paper trail
• Undisclosed rent increases or fees
• No written agreement — yes, verbal leases are legal in Ontario, but very risky

Lease Renewals, Changes, and Terminations

Once a lease term ends, tenants don’t automatically have to move out. In Ontario, the lease typically converts to a month-to-month tenancy under the same terms.

To legally terminate a lease:

• Tenants must give 60 days’ notice (in writing)
• Landlords can only terminate leases under very specific conditions, like owner move-in or non-payment of rent, and they must go through the LTB

Want to increase rent? That’s governed too — rent increases are capped annually by the Ontario government.

Common Lease Misunderstandings

Let’s bust a few myths:

• “I can kick the tenant out when the lease ends” – Nope. Not unless the LTB allows it.
• “I don’t need a written lease” – You can technically rent without one, but it’s a recipe for legal chaos.
• “I can raise the rent whenever I want” – Definitely not. There are strict rules about when and how much you can increase rent in Ontario.

Why You Should Consider a Property Manager

A strong lease can protect your investment — but only if it’s done right. That’s where property managers come in. We handle:

• Drafting legal, RTA-compliant lease agreements
• Clear and consistent communication with tenants
• Navigating disputes, rent increases, and lease terminations

At Welcome Home Management, we make sure your lease does what it’s supposed to — protect your property, your rights, and your peace of mind.

Final Thoughts

Lease agreements are the foundation of every rental relationship. Whether you’re renting out your first basement suite in Hamilton, or managing a multi-family unit in Niagara, knowing the rules (and avoiding the mistakes) makes all the difference.

If you’re feeling unsure about your lease or just want a second set of eyes — we’re here to help.