Ontario and its municipalities are introducing significant legislative and regulatory updates to address the ongoing housing and affordability crises. From revisions to the Ontario Building Code to municipal-specific bylaws, real estate professionals in Ontario should be aware of these changes because of their impacts on clients.

Province-Wide Changes

Mass Timber Construction Expanded to 18 Storeys

The provincial government has amended the Ontario Building Code to permit mass timber buildings up to 18 storeys, increasing the previous height limit of 12 storeys. Mass timber technology, which uses engineered wood products such as cross-laminated timber (CLT), features lower carbon emissions, reduced construction waste, and adaptability to pre-fabrication techniques. This allows for quicker assembly times, often cutting traditional build timelines in half. Mass timber’s structural integrity, cost efficiency, and sustainable profile make it an attractive alternative to concrete and steel, promising faster and quieter construction. This change aligns with Ontario’s housing goals by allowing for denser residential projects on the same land footprint.

The updated height limit will impact planning and approval for new developments, creating opportunities for environmentally conscious clients or those seeking innovative housing solutions.

Harmonizing the Ontario Building Code

Ontario’s new Building Code takes effect in 2025, with an emphasis on eliminating disparities between provincial and national codes, moving from 60% to 80% alignment with the National Building Code. Specific changes include adopting more stringent energy efficiency standards, improving accessibility provisions such as wider doorways and barrier-free designs, and incorporating modern structural safety requirements to reflect advanced construction techniques. These revisions aim to streamline approvals, reduce regulatory burdens, and encourage developers to expedite housing projects.

Changes will simplify project management for developers and increase predictability in the development process, positively affecting supply and investor confidence.

Toronto

Rental Renovation Licence By-Law

To combat “renovictions,” landlords in Toronto will be required to obtain a Rental Renovation Licence before issuing an N13 notice to tenants, under the new by-law which takes effect on July 31, 2025. Applicants must prove the necessity of tenant displacement through approved permits and provide temporary accommodations or compensation plans. Failure to comply with these requirements may lead to rejection of renovation plans, severe fines, and, in some cases, legal action against landlords. Tenants will also have access to an appeals process under this framework to challenge unreasonable displacement claims.

Agents working with landlords or tenants must stay informed about these stringent requirements, ensuring compliance to protect clients from legal and financial risks.

Updated Short-Term Rental Regulations

In 2025, Toronto is completing its final phase of new short-term rental (STR) bylaws. These rules reinforce earlier regulations requiring STR operators to register, increase operator fees, and restrict advertisements for partial-unit rentals. The goal is to safeguard long-term rental availability by limiting STR operations to primary residences. Additionally, enforcement measures such as stricter penalties for unregistered STRs and expanded inspection teams aim to ensure compliance.

Professionals helping clients interested in the STR market should advise them on compliance requirements and ways to adapt strategies to meet these limitations while helping preserve essential rental housing.

Hamilton

Vacant Unit Tax

Starting January 2025, Hamilton property owners must submit mandatory annual occupancy declarations, with vacant properties subject to a 1% tax on assessed value unless exempt. Exemptions include properties undergoing renovations, recently purchased properties, and cases of owner hospitalization or death. Revenue generated from the tax will fund affordable housing programs and initiatives. The policy discourages prolonged vacancy to increase housing availability.

Familiarity with exemptions and declaration deadlines will help agents guide clients in navigating compliance, tax liabilities, or investing in occupied properties.

Renovation Licence and Relocation By-Law

Hamilton’s new by-law will require landlords to obtain a renovation licence before displacing tenants for renovations, ensuring protections like temporary housing or compensation. This measure mirrors Toronto’s efforts to curb renovictions while prioritizing tenant rights. Hamilton further mandates that displaced tenants be offered a right to return to the property after renovations are completed, with no significant rent increases allowed. Non-compliance can result in project delays, fines, and tenant claims through adjudication processes.

The by-law demands detailed documentation and coordination, affecting timelines and costs for landlords. Educating clients about these requirements is vital to avoid penalties or disputes.

Housing Sustainability and Investment Roadmap

Hamilton continues to execute its 2024 Roadmap, focusing on increasing affordable housing, preserving existing stock, and enhancing tenant protections through initiatives like the Rental Housing Licensing Pilot and Safe Apartment Buildings By-law. Additional measures in the roadmap include incentivizing developers through reduced development charges for affordable projects and implementing proactive building inspections to maintain rental unit quality.

Understanding municipal initiatives helps professionals identify opportunities to support development or align investments with evolving policies.

Guelph

Accessory Dwelling Units

Guelph has embraced policies to encourage the development of accessory dwelling units (ADUs), such as basement apartments and backyard suites, as part of its broader housing strategy. The city has streamlined its permitting process for ADUs and removed previous restrictions on unit sizes and lot coverage, making it easier for homeowners to add secondary suites. However, the city has also introduced requirements for parking spaces and updated fire safety standards.

Real estate professionals in Guelph should highlight these changes when working with clients interested in investment properties or multi-generational housing solutions. Emphasizing the potential for additional rental income or accommodating extended family members can make properties with ADU potential more appealing.

Kitchener

Lodging House By-Law

Kitchener introduced new regulations to ensure safety and compliance in shared accommodations, affecting landlords renting rooms in properties with common spaces like kitchens or bathrooms. Requirements include annual safety inspections, property manager training certifications, and upgraded fire safety systems to meet new standards. Non-compliant landlords face license revocation and escalating penalties for repeated offences.

Clients with these types of properties should be made aware of the changes.

Ontario’s legislative and municipal changes reflect a concerted effort to address housing challenges by boosting supply, protecting renters, and modernizing policies. For real estate professionals, understanding these shifts is essential to navigating evolving markets, ensuring compliance, and supporting clients effectively. By staying informed on updates to zoning, licensing, and tenant protections, professionals can help clients adapt their strategies, identify opportunities, such as Guelph’s streamlined ADU process or Toronto’s inclusionary zoning, and mitigate risks associated with non-compliance, ultimately enhancing both market performance and client satisfaction.