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An investor is buying a detached house that had one residential unit until 2021, when the owner, who lived upstairs, turned the unfinished basement into a self-contained unit with its own kitchen, bathroom and lockable entrance. Both units are now rented under leases that began in 2024. Which unit is subject to the rent increase guideline?

Correct Answer

D) Only the main-floor unit; the basement unit is exempt

Section 6.1(3) exempts a unit in a house that had no more than two units on November 15, 2018, if the unit is self-contained, became a unit after that date, and either the owner lived in another unit when it was first occupied or it was built in previously unfinished space. The basement meets these tests; the main floor was a residential unit before that date, so the guideline still applies to it.

Answer Options
A
Both units, because the house was occupied for residential use before November 2018
B
Neither unit, since both leases began after 2018
C
Only the basement unit; the main-floor unit is exempt
D
Only the main-floor unit; the basement unit is exempt

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Key Terms

section 6.1(3)basement unitrent control exemptionNovember 15, 2018
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