Can You Evict Tenants After Purchasing Property in Ontario?

Evicting Tenants After a Property Purchase

Purchasing an investment property is an exciting venture. Many buyers look for homes that already have tenants. This provides immediate rental income. However, some buyers want to live in the property themselves. This raises a common question for new property owners: can you evict tenants after purchasing property in Ontario? The answer is yes, but you must follow specific legal rules. The law protects both landlords and tenants. You cannot simply ask a tenant to leave because you are the new owner. The tenancy agreement continues and transfers to you with the property.

You must have a valid reason to end the tenancy. The most common reason for a new owner is for personal use. This means you, an immediate family member, or a caregiver intends to move into the unit. The process requires proper notice, potential compensation for the tenant, and acting in good faith. Ignoring these rules can lead to significant legal and financial penalties. Understanding your obligations from the start ensures a smooth transition for you and respects the rights of the existing tenant. This knowledge is key to successful property ownership.

Your Role as a New Landlord

When you buy a tenanted property, you become the new landlord. This means you inherit the existing tenants and their lease agreement. The original lease terms remain in full effect. You cannot change the rent, rules, or end the tenancy just because ownership has changed. The tenant’s right to occupy their home is protected. This concept is often called security of tenure. It prevents landlords from ending a tenancy without a specific, legally valid reason. This ensures stability for renters and outlines clear responsibilities for landlords.

Every aspect of the landlord-tenant relationship is governed by provincial law. The Landlord and Tenant Board (LTB) is the official body that handles disputes. If you wish to end a tenancy, you must follow the procedures set by the LTB. This involves using specific forms and providing the correct amount of notice. Any attempt to remove a tenant outside of this legal process is illegal. This includes changing the locks or shutting off utilities. As the new owner, you must honour the existing agreement until you can legally terminate it.

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Following the Correct Legal Procedure

Ending a tenancy requires you to follow a precise legal process. A mistake at any stage can invalidate your notice, forcing you to start over. The process ensures fairness and gives the tenant adequate time to respond or find new housing. It all begins with correctly serving the official notice form to your tenant.

• Serve the N12 Notice

  You must fill out the N12 form completely and accurately. You then deliver it to the tenant. Acceptable methods include handing it to them directly, placing it in their mailbox, or sliding it under their door. The 60-day notice period begins the day after they receive the notice.

• File with the Landlord and Tenant Board

  If the tenant does not agree to move out by the termination date, your next step is to file an L2: Application to End a Tenancy and Evict a Tenant. You must file this application with the LTB. There is a fee for this application. Filing the L2 initiates a formal hearing process.

• Attend the LTB Hearing

  The LTB will schedule a hearing where both you and the tenant can present your cases. You must provide evidence that you intend to occupy the unit in good faith. An adjudicator will listen to both sides and make a decision based on the law and the evidence provided.

• Obtain an Eviction Order

  If the adjudicator rules in your favour, they will issue an eviction order. This is a legal document that sets a final date by which the tenant must vacate the property. The tenant is legally required to comply with this order.

The ‘Good Faith’ Requirement

The concept of “good faith” is central to any eviction for personal use. It means your intention to move into the property is genuine and honest. You are not using this reason as a way to achieve another goal, such as re-renting the unit for a higher price. The Landlord and Tenant Board takes this requirement very seriously. During a hearing, the LTB adjudicator will assess your credibility. They will look for evidence that supports your claim. This could include proof of selling your current home or making arrangements to move your belongings.

Acting in “bad faith” carries severe consequences. If a tenant believes they were evicted in bad faith, they can file an application with the LTB up to one year after they move out. If the LTB finds that you did not occupy the unit as stated, or that you re-rented, advertised, or sold the property within 12 months, they may rule against you. The penalties can be substantial. The LTB can order you to pay the former tenant’s moving costs, storage fees, and the difference in rent between their old unit and their new one for up to a full year. There can also be significant fines.

Alternatives to a Formal Eviction

The formal eviction process can be long and uncertain. It involves legal paperwork, potential hearings, and strict timelines. For this reason, many new landlords explore alternatives. One popular option is a “cash for keys” agreement. In this scenario, you negotiate a deal with the tenant. You offer them a sum of money in exchange for them voluntarily agreeing to move out by a specific date. This approach can be faster and less adversarial than a formal eviction. It provides certainty for both you and the tenant.

If you and the tenant reach an agreement, you must document it using the N11: Agreement to End the Tenancy form. Both parties sign this form. The N11 creates a legally binding agreement to terminate the lease on a specific date. Unlike the N12 notice, the N11 is a mutual decision and does not require a reason for ending the tenancy. This method gives you a definite move-out date and helps the tenant with their moving expenses. It often creates a more positive outcome than a contested LTB hearing.

Final Thoughts on Tenant Eviction

Successfully navigating the eviction process as a new property owner is possible. The key is to understand your legal duties and the rights of your tenants. While you can end a tenancy for personal use, you must follow the established rules without deviation. This includes providing the correct notice on the proper forms, offering the required compensation, and always acting in good faith. The law is designed to be fair, and any attempt to sidestep the process can result in costly penalties and delays. Your intention must be genuine, and you must be prepared to prove it.

Consider all your options, including negotiation. A mutual agreement to end the tenancy can save time, stress, and money. It allows both you and the tenant to move forward on positive terms. Whether you choose the formal eviction path or a negotiated settlement, knowledge is your greatest asset. Working with a real estate professional who understands landlord and tenant law can provide valuable guidance. They can help you make informed decisions that protect your investment and ensure you start your journey as a landlord on the right foot.