Prince Edward Island 2025 Allowable Rent Increase Was 2.3%: What It Covered and How the Rules Worked
by Platuni | 06 Oct, 2026 | 5 mins read
Platuni
06 October, 2026
5 mins read
1. How the 2.3% was set
The Residential Tenancy Act has the Director set the allowable increase each year, considering PEI's Consumer Price Index averaged over the 12 months ending June 30 and written representations from landlords and tenants. The figure cannot exceed 3%.
[Cite: Residential Tenancy Act, RSPEI 1988, c. R-13.11, s. 49]
News reporting on the 2025 decision says it was announced September 5, 2024 and that the Commission received 57 submissions. The reporting does not explain how the submissions shaped the final number.
[Cite: Ocean 100 news report on the 2025 allowable increase, September 2024]
2. Which increases the 2.3% covered
The 2.3% applied to increases taking effect from January 1, 2025. A landlord who served notice in the fall of 2024 for a January 1, 2025 increase worked from 2.3%. An increase taking effect on December 1, 2024 fell under the 2024 figure instead.
[Cite: Ocean 100 news report on the 2025 allowable increase]
The sources reviewed do not carry the 2024 figure, so that year's percentage should be taken from the Residential Tenancy Office's historical table.
3. Worked example
On a rent of $1,300, a 2.3% increase is $29.90, giving a new rent of $1,329.90. With a successful additional-increase application at the full 3%, the ceiling would be 5.3%, or $68.90, for a new rent of $1,368.90.
4. Notice and timing
The Act requires written notice at least 3 months before the increase takes effect in a month-to-month tenancy and bars an increase within 12 months of the last one.
[Cite: Residential Tenancy Act, s. 48]
A landlord who gave less notice or raised the rent inside the 12-month window cannot rely on the 2.3% to defend the increase.
5. Additional increases up to 5.3%
A landlord could apply to the Director for more than 2.3%. The Director considers the unit's three-year rent history, changes in operating and capital expenses, the landlord's reasonable return and tenant expectations. Any approved amount cannot exceed 3% on top of the allowable figure.
[Cite: Residential Tenancy Act, s. 50]
The Commission's Order LR25-31, dated July 15, 2025, shows the ceiling in use. It approved total increases of 5.3% effective January 1, 2025 for two properties, the 2.3% guideline plus the extra 3%, and described the legislation as limiting additional increases to an extra 3%.
[Cite: Island Regulatory and Appeals Commission, Order LR25-31]
6. Where the 2025 figure sits against other years
Rent was frozen for 2023, when the Act set the cap at zero. The 2025 figure of 2.3% was followed by 2% for 2026 and 2.1% for 2027.
[Cite: Residential Tenancy Act, s. 49(4); Residential Rental Property, "2026 Maximum Annual Allowable Rent Increase"; Residential Rental Property, "2027 Allowable Annual Rent Increase"]
A landlord comparing years should note that the allowable amount has been below the 3% statutory cap in each year the sources report.
7. If a 2025 increase was higher than allowed
A tenant who believes an increase exceeded the allowable amount can file a Tenant Application to Determine Dispute (Form 2(A)) with evidence of the earlier rent, such as the previous agreement or a listing. The sources reviewed do not state a limitation period for such a claim, so a tenant should act promptly and check the time limits with the Residential Tenancy Office.
[Cite: Residential Rental Property, "Rent Increases"]
Landlords who may have exceeded the figure should review the notice, the effective date and the calculation, and compare them against any additional-increase order.
8. What property managers should do now
Review any 2025 increases still on file for notice length, effective date and arithmetic, particularly where a unit had an additional-increase application pending. For current planning, use the 2% figure for 2026 and 2.1% for 2027.
Keep the notice, the proof of delivery and any Director's order together in one record for each unit.
Frequently asked questions
What was PEI's allowable rent increase for 2025?
2.3%, effective January 1, 2025.
Could a landlord charge more than 2.3%?
Only with the Director's approval, up to an additional 3%, for 5.3% in total.
How much notice was required?
At least 3 months in writing, with 12 months between increases.
Does the 2.3% still apply?
No. It applied to increases taking effect in 2025. The 2026 figure is 2% and the 2027 figure is 2.1%.
Who announced the 2025 figure?
News reporting says the Island Regulatory and Appeals Commission announced it on September 5, 2024.
How can a tenant challenge a past increase?
By filing a dispute application with the Residential Tenancy Office, with evidence of the earlier rent.
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