If you are renting in Ottawa or you are an investor or landlord watching the market, there is a new policy coming into effect that you will want to understand. Beginning January 1, 2025, many Ottawa tenants will receive an automatic rent reduction. It is part of a citywide adjustment meant to bring older rental properties in line with current property tax ratios.
Let’s go through what is changing, who it affects, and what it means for you.
What’s changing
The City of Ottawa recently updated its property tax ratio for older multi-residential buildings that were built before 2002. These buildings were historically taxed at a higher rate than newer rental properties or owner-occupied homes. Because of this change, landlords in qualifying buildings are now required to pass those savings on to tenants through automatic rent reductions.
Under Ontario’s Residential Tenancies Act, if a landlord’s property taxes fall by more than 2.49 percent compared to the previous year, tenants in that building automatically qualify for a rent decrease.
For example, if your rent is $2,000 per month, you could see a reduction of about $16 monthly. You do not need to apply or complete any forms. The change happens automatically if you were living in your unit on December 31 of the previous year.
You can find more about how this process works directly from Tribunals Ontario.
Why it matters
For renters:
A rent reduction, even a small one, helps offset rising living costs. This may also be the right time to revisit your housing goals. If you are planning to buy, a modest rent break can make it easier to save for your down payment.
For investors and landlords:
This change shows how municipal tax policy can influence rental income and overall return. If you own or plan to buy an older multi-residential property, this should be part of your cash flow analysis. Changes in tax ratios directly affect profitability, and understanding these factors helps investors make better decisions.
For real estate professionals:
This is a great opportunity to educate clients. Whether you are advising renters who want to buy or landlords managing portfolios, sharing clear and timely information about local policy changes builds trust and sets you apart.
For more information, you can read Councillor Shawn Menard’s update on his website.
What to check
Confirm if your building qualifies. The rent reduction applies only to buildings built before 2002 that experienced a qualifying property tax decrease.
If you are a tenant, confirm that your landlord received the city’s notice and has adjusted your rent correctly.
If you are a landlord or investor, review your most recent property tax bill to see if your property qualifies.
If you are planning to buy, think about how this policy could affect rental income or tenant turnover in older buildings.
You can also read more details about the city’s announcement on CTV News Ottawa.
The bottom line
If you rent in Ottawa and have been in your unit since before the new year, you may notice a small rent decrease starting in January. While the change might not be large, it reflects how local policies can shape both affordability and investment returns.
For renters, this may be the moment to evaluate whether continuing to rent or starting to plan for homeownership makes more sense. For landlords and investors, it is worth revisiting your financials to ensure your numbers still make sense.
If you are not sure how this change fits into your next move, whether you are renting, buying, or managing a property portfolio, I am happy to help you make sense of it.
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