Legalize and License Shared Rental Homes

Summary#

Toronto City Council considered the Mayor’s 2023 Housing Action Plan and adopted a new citywide framework to legalize and regulate multi-tenant houses (often called rooming houses). The broad goal is to create more homes across the city, improve safety in shared housing, and track progress on affordable rental supply.

Key changes:

• Direction to prepare a 2023 Housing Action Plan for 2022–2026, aiming to meet or exceed 285,000 new homes in 10 years, with timelines, targets, and unit estimates across zoning and program actions.
• Council adopted a citywide regulatory framework for multi-tenant houses, including licensing, regular inspections, clear operating standards, and stronger enforcement.
• Minimum parking requirements for multi-tenant houses were removed.
• The effective date for the new multi-tenant zoning and licensing was moved to March 31, 2024 to align with phased implementation.
• A new Multi‑Tenant House Licensing Tribunal will hear licensing matters and can add conditions, suspend, or revoke licences.

Main elements of the Housing Action Plan (to be detailed in a March 2023 staff report) include:

• Making zoning more permissive for “gentle density” (e.g., multiplex houses), allowing more homes on major streets, and creating transition zones.
• Reviewing design, heritage, and urban forestry rules to support needed housing.
• Optimizing housing density in the Port Lands, the Waterfront, and other major projects.
• Updating affordable housing programs (e.g., Open Door), intensifying community/non-profit and co‑op housing, and revisiting City “Housing Now” sites.
• Strategies for student housing (with post‑secondary schools), using school board lands for housing, and boosting construction workforce capacity.
• Public tracking of affordable rental units approved, under construction, and built, and ensuring growth ties to complete communities and supporting infrastructure.

What it means for you#

• Tenants in multi-tenant houses

  • Safer, better-maintained homes are the aim. Licensed homes will face annual inspections by City bylaw and fire staff.
  • Tenants must see posted information (licence, contacts, plans) and can expect clear processes for repairs, pest control, and urgent service requests (heat, water, power).
  • If a personal-care multi-tenant house serves you (meals, urgent response, medication storage), the operator must meet added staffing and care standards, including 24/7 on‑site supervision and an intake assessment by a regulated health professional.
  • If a house must close or reduce rooms for safety, operators must give advance notice and develop a tenant transition plan. The City is developing programs to mitigate displacement, but details are still to come.

• People seeking lower-cost rooms (students, newcomers, workers, seniors)

  • More multi-tenant houses would be legal across all areas where housing is allowed, starting March 31, 2024. This could increase options, including near schools and jobs.

• Multi-tenant house operators/landlords

  • You must obtain and renew an annual City licence, follow posted property maintenance, waste, pest, and tenant service plans, and keep floor/exterior plans.
  • Larger houses (10+ rooms/units) or where required must complete an electrical safety evaluation.
  • Personal-care houses have added qualification, staffing, menu, and record-keeping rules.
  • Fees: $25 per room/unit per year (inspection fee $150); fees are waived for non-profits and Toronto Community Housing. Fines for non‑compliance can be up to $100,000, with daily penalties and recovery of economic gains.
  • If you plan to stop operating, you must provide 210 days’ notice with a transition plan and 180 days’ written notice to tenants.

• Neighbourhood residents

  • Multi-tenant houses will be permitted in residential and mixed-use zones citywide as of March 31, 2024, with no required on-site parking minimums for this use.
  • The City will focus on life-safety first, with escalation to stronger enforcement for chronic issues (e.g., property standards, nuisance).

• Non-profits, co-ops, and housing providers

  • The City plans to intensify community housing, update Open Door, and launch a Multi‑Tenant Housing Renovation and Retrofit Program to help operators meet building, fire, and accessibility standards in exchange for affordability commitments.

• Post-secondary institutions and school boards

  • The City will seek student housing strategies, partnerships, and the potential use of school lands for housing.

• Builders and trades

  • Expect zoning changes that could allow more “as-of-right” homes (e.g., multiplexes, mid‑rise on major streets), and initiatives to expand construction workforce capacity.

• Timing

  • Multi-tenant licensing and zoning changes start March 31, 2024, with a phased rollout. Other Housing Action Plan measures will be proposed in a staff report (targeted March 2023) with timelines and targets.

Expenses#

Estimated public cost: The multi-tenant house program is expected to increase operating costs once fully implemented.

• Municipal Licensing and Standards: projected annualized program cost about $4.36 million, including roughly $3.57 million in new budget needs (e.g., 22+ officers, administration, vehicles).
• Toronto Fire Services: about $1.78 million annually if projected licence volumes are reached (about 16 new inspection staff).
• Court Services: about $0.42 million annually to run the Multi‑Tenant House Licensing Tribunal.
• Licence fee revenue: roughly $25 per room/unit per year (non‑profits exempt). Depending on total licences issued, annual revenue could be on the order of $100,000–$400,000.
• Operators’ compliance costs: $25 per room/unit annual licence fee; $150 per inspection; one‑time zoning review (~$200); electrical evaluation for larger houses; personal‑care staffing/training and dietitian review; and any building/fire code upgrades (varies by property). A City retrofit program is planned to offset some costs in exchange for affordability.
• The Housing Action Plan itself will include timelines, targets, and any budget needs when staff report back. What the comprehensive plan will cost is not yet set.

Proponents' View#

• The measures appear intended to respond to the housing crisis by adding homes of many types faster, while improving safety and oversight in one of the city’s most affordable housing forms (multi-tenant houses).
• Legalizing multi-tenant houses citywide and removing parking minimums could reduce discrimination by “zoning for land use, not people,” expand options in all neighbourhoods, and improve tenant safety through licensing and inspections.
• Stronger enforcement tools (higher fines, a dedicated tribunal, remedial work at owner’s expense) and clear operator responsibilities can raise standards without mass closures.
• The Housing Action Plan’s focus on gentle density, mid‑rise on major streets, optimizing large redevelopment areas, and partnerships with non‑profits, schools, and school boards could unlock significant new supply near transit and jobs.
• Supportive submissions were filed by Habitat for Humanity GTA, the Toronto Region Board of Trade, the Building Industry and Land Development Association, the Residential Construction Council of Ontario, the Canadian Centre for Housing Rights, the Waterfront BIA, the University of Toronto, and HousingNowTO.com, citing the need to accelerate supply, legalize multi‑tenant houses with strong enforcement, and track outcomes.

Opponents' View#

• Enforcement capacity and funding: Residents’ groups (e.g., FoNTRA) questioned whether the City has enough inspectors and budget to enforce the new rules fairly and consistently, and asked for clear performance measures and a formal review before expanding to new operators.
• Neighbourhood impacts: Some residents (e.g., Long Branch Neighbourhood Association) raised concerns about allowing multi‑tenant houses citywide and removing parking minimums, citing waste, noise, and parking pressures, and asked for ward‑specific approaches.
• Risk of displacement: Tenant and advocacy submissions supported legalization but warned that bringing homes up to code could displace low‑income tenants if not carefully managed. Right to Housing Toronto urged the City to protect existing affordable rentals and plan for accessible homes, and to ensure supports are in place if closures occur.
• Process and affordability focus: A submission from an individual (Melissa Goldstein) criticized the process and argued zoning changes alone may not improve affordability and could risk loss of existing lower‑cost housing if not paired with strong tenant protections.
• What is unclear: The final Housing Action Plan details (timelines, specific zoning changes, targets, and costs) are not yet public. It is also unclear how many additional homes the multi‑tenant framework will produce, how quickly operators will transition, and how tenant displacement risks will be mitigated in practice.