Editor's note, October 6, 2026: this article was reviewed and rewritten in our accuracy check. An earlier version contained cash-for-keys amounts, cap-rate examples, an LTB award and statements about recent amendments we could not confirm; they have been removed or replaced with figures from the sources listed at the end of the article.
In Ontario, selling a rental property does not end the tenancy. The Residential Tenancies Act, 2006 (RTA) protects the tenant's right to stay, and the buyer takes over the lease, unless the tenant agrees to leave or the buyer qualifies to end the tenancy for their own use. Here is how it works.
Your options
- Sell with the tenant in place. The buyer becomes the landlord, with the same rent and lease terms. Usually this means selling to an investor.
- Sell vacant using an N12. If the buyer (or the buyer's spouse, child or parent, or their spouse's child or parent, or a caregiver for one of them) will live in the unit, the seller can give the tenant a Form N12 after the agreement of purchase and sale is signed.
- Agree with the tenant to end the tenancy, using the LTB's Form N11. Any payment you offer is a private agreement; put it in writing, and never pressure a tenant to sign.
- Wait for the tenant to give notice (Form N9), which for a monthly tenancy is at least 60 days, ending at the end of a period or term.
How an N12 for a buyer works
- The property must have three or fewer residential units (a condo unit qualifies), and there must be a signed agreement of purchase and sale.
- The notice must give at least 60 days and end on the last day of a rental period or of a fixed term.
- The landlord must pay the tenant compensation of one month's rent, or offer another unit acceptable to the tenant, on or before the termination date.
- The person who will move in must genuinely intend to live in the unit for at least one year. The LTB's guideline explains how it assesses good faith, and tenants can apply to the LTB if a notice was given in bad faith.
- If the tenant doesn't move out, the landlord must apply to the LTB for an order. A landlord can't change the locks or remove a tenant without one.
- After receiving an N12, the tenant may move out earlier by giving at least 10 days' written notice.
Timing matters: closing must allow for the notice period, and for an LTB hearing if the tenant doesn't leave. Your lawyer and the buyer's lawyer will set the closing date and conditions with this in mind.
Showings
A landlord may enter to show the unit to a potential purchaser with at least 24 hours' written notice, between 8 a.m. to 8 p.m., stating the reason and time of entry. Tenants may be present. Respecting the tenant's privacy, and agreeing showing windows in writing, makes for a smoother sale.
Rent, deposits and the buyer
- The tenant keeps paying the same rent, now to the buyer. Rent increases still follow the guideline and the 90-day notice rule (units first occupied after November 15, 2018 are exempt from the guideline but not the notice rule).
- A last-month's rent deposit transfers to the buyer, usually as a credit on the statement of adjustments.
- Give the buyer a copy of the lease and the rent history so their lawyer can review them.
Read our evergreen guide to selling a house with tenants, or ask Zara, Summitly's AI virtual agent. This article is general information, not legal advice; a lawyer or paralegal can advise on your tenancy.
