New Landlord Checklist for Canada

Run the numbers before making an offer

Estimate monthly cash flow, cap rate and cash-on-cash return using a Canadian rental property ROI calculator. Do this before you fall in love with a property, not after.

Confirm the property can legally be rented Provincial

Check zoning bylaws and, if the property is a condo or strata unit, review the rules for rental permissions. Some strata corporations restrict or prohibit rentals entirely.

Understand investment property financing rules

Non-owner-occupied investment properties require a minimum 20% down payment in Canada. CMHC mortgage insurance is not available for investment properties. The mortgage stress test applies to your qualification rate.

Budget for all closing costs Provincial

Beyond the down payment, closing costs typically include land transfer tax (which varies significantly by province and doubles in Toronto), legal fees, title insurance and the property inspection. Budget 2 to 4% of the purchase price for these costs.

Get a thorough property inspection

A pre-purchase inspection should cover electrical, plumbing, roof, foundation and HVAC systems. If the property has a wood-burning fireplace or stove, request a WETT inspection as well. Issues found after purchase become your problem immediately.

Consult a lawyer and an accountant before you sign

A real estate lawyer should review the purchase agreement. An accountant who works with rental property owners should advise on the tax implications before you buy. The decisions you make at purchase affect your tax situation for the entire time you own the property.

Get landlord insurance

A standard homeowner policy does not cover a property being rented to tenants. Landlord insurance covers the building, your liability as a landlord and typically includes protection for lost rental income if the property becomes uninhabitable due to an insured loss.

Check local rental licensing requirements Provincial

Many municipalities require landlords to hold a rental unit license or register with a local registry. Requirements, fees and inspection obligations vary widely. Check with your city or municipality directly. Penalties for renting without required licenses can be significant.

Confirm safety equipment is in place

Working smoke detectors and carbon monoxide detectors are legally required in all rental units in Canada. Ensure they are installed on every level, test them before a tenant moves in, and keep a record of when batteries were replaced.

Open a dedicated bank account for the rental

Keep rental income and expenses completely separate from your personal finances. Most accountants who work with landlords consider this essential. It makes tax preparation far simpler and gives you a clean paper trail if questions ever arise.

Set up a record-keeping system from day one

Keep copies of every receipt, invoice, lease, inspection report and written communication related to the property. You need this for your annual tax return and potentially for dispute resolution. A simple folder system, paper or digital, is enough.

Read your provincial tenancy legislation Provincial

Landlord-tenant law is set at the provincial level in Canada. Before you rent to anyone, understand your obligations around maintenance, entry notice, rent increases and the process for ending a tenancy. Ignorance of the rules is not a legal defence.

Know your human rights obligations Provincial

You cannot refuse a tenant based on protected grounds including race, religion, sex, family status, disability or source of income (in many provinces). Read your provincial human rights code before advertising. Violations can result in complaints to a human rights tribunal.

Screen applicants consistently and document everything

Request a credit report, proof of income and references from previous landlords. Write down your selection criteria before you start reviewing applications and apply them the same way to every applicant. Consistent criteria protect you from human rights complaints.

Use a province-compliant lease agreement Provincial

Most provinces have a standard lease form that landlords are required to use. Ontario, BC and Alberta all have mandatory standard lease forms. Using a non-compliant lease can give the tenant the right to void certain clauses or trigger other legal consequences.

Understand deposit rules before collecting any money Provincial

Security deposit rules vary significantly across provinces. Some cap the amount at one month's rent, some prohibit certain types of deposits, and most have strict rules on how deposits must be held and the timeline for returning them. Check current rules in your province before collecting anything.

Complete a written move-in condition report

Walk through the property with the tenant before move-in, photograph every room and note the condition of appliances, walls, floors and fixtures. Have both parties sign and keep a copy. This document is your primary protection when it comes to deposit deductions at the end of the tenancy.

Handle maintenance requests in writing

Acknowledge repair requests by email or text so you have a timestamped record of when each issue was reported and how you responded. Landlords in most provinces are required to maintain the property in a good state of repair. Delayed or ignored repairs can expose you to rent abatement orders or other legal action.

Know the rent increase rules before raising rent Provincial

Most provinces with rent control cap annual increases and require written notice delivered within a specific time window before the increase takes effect. The allowable percentage is set by each provincial government, typically announced each fall for the following year. Check current rules with your provincial tenancy authority before issuing any rent increase notice.

Report rental income and claim eligible expenses each year

Rental income must be reported on your personal tax return. Eligible deductions include mortgage interest, property taxes, insurance, property management fees, repairs and maintenance, advertising costs and professional fees. Keep every receipt. An accountant who works with landlords can ensure you are claiming everything you are entitled to.

Ask your accountant about Capital Cost Allowance

CCA allows you to claim depreciation on the building portion of your rental property, which reduces your taxable rental income each year. However, CCA recapture applies when you sell, which can create a significant tax bill. Whether claiming CCA makes sense depends on your individual situation and is a decision to make with your accountant, not on your own.

Review your landlord insurance policy annually

Confirm your policy reflects the current replacement value of the property. Construction costs change over time and an outdated coverage amount could leave you significantly underinsured after a major loss. Also verify that your policy is still appropriate for how the property is being used.

Stay current with changes to tenancy law Provincial

Provincial landlord-tenant legislation changes periodically. Rules around evictions, rent increases, short-term rentals and tenant protections have all seen changes in recent years across multiple provinces. Subscribe to updates from your provincial residential tenancy authority so rule changes do not catch you off guard.