Renting in Prince Edward Island

CMHC for Consumers	November 2006

Governing or Regulatory Body

Office of the Director of Residential Rental Property

Name of Act / Regulations

Rental of Residential Property Act

Types of Housing/Living Arrangements Covered by the Provincial Legislation

Furnished, partly furnished or unfurnished residential rental units including: any house, dwelling, apartment, flat, tenement, room, mobile homes and land rented as a mobile home site.

Exclusions: premises provided by an educational institution to its students; premises licensed under the Community Care Facilities and Nursing Homes Act; premises licensed under the Tourism Industry Act except when such premises are provided as accommodation for a guest for a continuous period of one month or more; premises which provide therapeutic or rehabilitative services or temporary shelter such as transition houses and hostels and other such premises which have supervisory services as that term is defined in the Community Care Facilities and Nursing Homes Act; premises provided as group homes under the Welfare Assistance Act, premises ordinarily occupied by the owner and vacated by the owner for a period not exceeding seven months during a calendar year, premises which are co-operative housing.

Types of Rental Periods

Leases must have a fixed term with a predetermined expiry date. Verbal or written month to month rental agreements and week to week rental agreements are also allowed.

Is a signed lease required?

No. A verbal agreement can still be binding. Where a written rental agreement exists, the landlord must provide the tenant with a full copy of that agreement within 21 days of the date that the agreement was signed. If the landlord does not provide the tenant with a copy of the written agreement, the tenant is not bound by any terms of that agreement that go above and beyond those already implied by the Act, unless and until the landlord forwards a copy of the lease.

Those entering into a written rental agreement or renewing a written rental agreement and who do not sign the standard form are deemed to have done so and all the provisions of the Rental of Residential Property Act and the standard form apply.

Is a signed move in/move out checklist required?

No. A checklist is recommended but not required.

Deposits

The security deposit cannot be greater than one week's rent for a weekly tenancy or one month's rent in any other circumstances. A landlord must request a security deposit on or before the date that the landlord and the tenant enter into the rental agreement. Interest is added to the security deposit each year at a rate that is set annually by a formula prescribed by legislation. When the tenant moves out of the residence, the landlord must either return the security deposit plus accrued interest to the tenant within ten days or serve the tenant with a notice stating why the security deposit is being retained. A landlord can retain the security deposit for cleaning, damages or rent owing. If a tenant receives a Notice of Intention to Retain security Deposit from the landlord and doesn’t agree with the landlord‘s reasons for keeping the security deposit, the tenant has the right to file an Application Re Determination of Security Deposit within 15 days. A tenant should provide the landlord with their forwarding address when they move out.

Key Money

Requiring key money is illegal.

Post-dated Cheques

Landlords may request post-dated cheques, but there is no legal requirement for the tenant to provide them.

Renewal of a Lease Term

Where a fixed term rental agreement is not terminated by the landlord or the tenant, upon its expiration it automatically converts to a month-to-month rental agreement. If the fixed term rental agreement contains an option to renew, and the tenant fails to renew the fixed term, the landlord can serve the tenant with a Notice of Termination.

Terminating a Lease: Notice and Timing

Prior to a lease terminating, it is the responsibility of landlord and tenant to re-negotiate terms or terminate the lease. Tenants may not terminate during a fixed term lease, only at the end of the fixed term. Landlords may only terminate a tenancy for specified reasons as set out in the legislation and cannot terminate simply because a fixed term has expired. However, if the lease contains an option to renew and the tenant fails to renew the lease, the landlord can serve the tenant with a Notice of Termination on that basis. When a fixed term tenancy goes to a month to month term, the landlord cannot force a tenant to sign another lease or agree to another fixed term. When a lease is renewed, unless otherwise agreed, other than the new term of the lease, all other conditions of the lease remain the same.

Depending on the situation, parties may need to serve a notice or a document to a landlord, to a tenant, to the Director of Residential Rental Property or to the Island Regulatory and Appeals Commission. Personal delivery, regular, certified, or registered mail of the document to the relevant person may be used.

If the tenant is renting on a fixed-term lease, such as one year, the tenant must give written notice to the landlord at least two months before the end of the lease. For a month-to-month tenancy the tenant must provide a written notice of termination to the landlord on or before the day that rent is due and at least one month before the tenant wishes to move out.

A landlord must have a reason to give a tenant notice to vacate and the notice periods depend on the reason. For example:

rent arrears: 20 days must be given,
failing to provide quiet enjoyment, failing to fulfil your responsibility for ordinary cleanliness of the interior of the residential premises or for damage caused by you or persons you permitted on the premises, damages beyond reasonable wear and tear, and the damages have not been repaired within a reasonable time: 1 month must be given, and
a family member moving into the premises, purchaser wants possession of the premises, demolition or conversion of the building to another use, required renovations that cannot be carried out while the tenant is occupying the premises: 2 months must be given, unless it is possession of a mobile home site, in which case 6 months notice must be given.

Assignments and Sublets

Where a fixed term rental agreement is for six months or more, the tenant can sublet or assign the rental unit, subject to the landlord's consent. The landlord cannot unreasonably withhold consent. If a tenant believes that consent has been unreasonably withheld, he or she may apply to the Director of Residential Rental Property for an order authorizing the sublet or assignment.

Rent Increases: Notice and Timing

Allowable rate of rent increases is set by The Island Regulatory and Appeals Commission each year. If a landlord wishes to increase the rent, he must serve the tenant with a Notice of Increase in Rent of Residential Premises at least three months before the date the recent increase is to take effect. Landlords, who wish to raise the rent above the allowable rate as set by IRAC, must apply to the Director of Residential Rental Property for approval. Landlords may not raise the rent until a fixed-term lease expires. Rent increases are tied to the property, not the tenant. A landlord can increase the rent for a unit once a year, and the amount of rent increase is the same regardless of the number of people living in the unit, or whether the unit has changed hands. The rent for a new tenant rent should be the same as for the previous tenant if a rent increase in that year was already made.

Late Rent Payments

If the rental agreement contains provisions for a penalty for late payment of rent, the penalty shall not exceed one per cent per month of the monthly rent.

Evictions

There are several reasons why a tenant may be evicted and the required notice period the landlord must give depends on the grounds for eviction. The main reason for evictions is rent arrears. If rent is due on the first day of the month and the tenant doesn’t pay the rent, the landlord can issue a notice of termination. A tenant can invalidate the notice by paying all of the outstanding rent within 10 days of receiving the notice or the tenant will have to vacate by midnight of the 20th day.

If a tenant receives more than two Notices of Termination that indicate non-payment of rent as the reason for termination, the landlord may apply to the Director of Residential Rental Property for an order terminating the tenancy based on persistent late payment.< /p>

Where a notice of termination is served by the landlord, the tenant can make application to the Director within 10 days to set aside the notice of termination and the matter is dealt with in a hearing of both parties. If the tenant doesn‘t file an application to set aside the notice of termination within the 10 days, it is deemed that the tenant has accepted the vacate date on the notice of termination and should be moved out by the date stated. If the tenant doesn‘t vacate, the landlord can file an application requesting possession of the residential premises.

Fine Points

Permitting Landlord Entry to the Premises (Times and Reasons)

Except in the case of an emergency, a landlord shall not enter the premises without the consent of the tenant unless the landlord has served written notice stating the date and time of the entry with at least 24 hours notice. The entrance time stated must be between 9:00 a.m. and 9:00 p.m.

May the tenant withhold rent for repairs?

No.

Changing Locks

Changing locks requires the mutual consent of the landlord and tenant.

Pets and Smoking

May a landlord refuse to rent to a tenant who has pets or smokes?

Yes, a landlord may refuse to rent to a tenant who has pets or smokes.

If a no pets and no smoking clause is written into a lease and the landlord discovers that the tenant has a pet and/or smokes in the rental unit, is this grounds for the landlord to evict the tenant?

Yes, if a tenant breaches the rental agreement by having a pet or smoking in the rental premises this could result in an eviction.

Contact Information

For general information about renting in Price Edward Island contact:

Office of the Director of Residential Rental Property
134 Kent Street, Suite 501
P.O. Box 577
Charlottetown, PE
C1A 7L1
Toll-free: (PEI) 1-800-501-6268
Tel.: 902-892-3501
Fax: 902-566-4076
http://www.irac.pe.ca/rental/



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