OLFA
N2 Form Ontario — Understanding Rent Increases for Exempt Units
The N2 form is used for rental units that are exempt from Ontario's annual rent increase guideline.
This often includes certain newer rental units, some care homes, and specific exempt tenancy arrangements.
The N2 allows landlords to increase rent beyond the annual guideline, provided proper notice requirements are followed.
When Should You Use an N2?
An N2 is appropriate when:
- The rental unit is exempt from rent control
- At least 12 months have passed since the last increase
- The tenancy is continuing
Example of Proper N2 Use
A landlord rents a condo first occupied residentially after November 15, 2018.
Because the unit is exempt from rent control, the landlord uses an N2 to increase rent from $2,400 to $2,650 after proper notice.
When Should You NOT Use an N2?
You should not use an N2 if:
- The unit is rent controlled
- You are increasing rent within the annual guideline for controlled units
- The tenancy is ending
Example of Incorrect N2 Use
A landlord attempts to use an N2 for a rent-controlled apartment built in the early 2000s.
This could create legal issues because an N1 is generally required instead.
Common N2 Errors
Landlords often run into problems because they:
- Incorrect exemption assumptions
- Wrong notice periods applied
- Improper effective dates selected
- Confusing N1 and N2 eligibility requirements