Buying a Tenanted Home in Ontario: Can You Move In?

You have found a home you want to live in, but it has a tenant. Many buyers assume they can simply ask the tenant to go once the sale closes. In Ontario, the process is more structured than that, and the rules protect the tenant as well as the buyer.

This article explains how the purchaser's-own-use N12 notice works, who can give it, what it costs the seller, and what risks you take on as the buyer if you do not follow through. Every situation turns on its own facts, so use this as a map, not a substitute for advice on your deal.

How the purchaser's-own-use N12 works

The notice is not given by the buyer. Under s. 49 of the Residential Tenancies Act, 2006, a landlord who has signed an agreement of purchase and sale may give the tenant an N12 notice. That means the seller, as the current landlord, is the one who serves it, usually after the agreement is signed and often with your input on timing.

Because the notice depends on your plans, it is worth deciding early whether you truly intend to live in the home. The agreement of purchase and sale may also deal with the tenant, so it is sensible to have a lawyer review those terms before you sign.

Which properties and which buyers qualify

The notice is available only where the sale is of a residential complex of no more than 3 units, or of a condominium unit. Tenants in larger buildings cannot be ended this way, because the purchaser's-own-use N12 is not available for a complex with more than 3 units.

The purchaser must also need the unit in good faith for residential occupation. The person who will live there can be the purchaser, their spouse, a child or parent of either of them, or a caregiver.

• The home must be a complex of 3 units or fewer, or a condominium unit.
• The seller must already have signed an agreement of purchase and sale.
• The need to live in the unit must be real and in good faith.
• The occupant must be the purchaser, a spouse, a child or parent of either, or a caregiver.

Timing and compensation

The termination date in the notice must be at least 60 days after the notice is given. It must also fall on the last day of a rental period or of a fixed term. In practice, this means a closing date alone does not decide when the tenant must leave, so your move-in plans need some room.

On money, the selling landlord, not the purchaser, must pay the tenant one month's rent, or offer an acceptable unit, by the termination date. Buyers sometimes assume they will carry this cost, so it is worth making sure the agreement of purchase and sale is clear about who handles the notice and the payment.

A newer option does not change this. Section 48.1, effective September 21, 2026, allows a 120-day notice without compensation, but it applies to the landlord's own use under s. 48 and is not described as applying to purchaser notices under s. 49. Do not assume a purchaser can use it.

If you do not move in: your exposure

If the purchaser does not move in after a purchaser N12, the notice may be treated as having been given in bad faith. The former tenant can then file a T5 application within one year of moving out.

The Landlord and Tenant Board may order rent differential, moving costs, general compensation of up to one year's rent, and an administrative fine. It may also name the purchaser as a respondent. So even though the seller served the notice, the risk can land on you.

• Rent differential and moving costs for the former tenant.
• General compensation of up to one year's rent.
• An administrative fine.
• Possible personal liability, because the purchaser may be named as a respondent.

How this applies to you depends on your situation and the facts, so it is worth confirming with a lawyer, especially if your plans change.

What to do next

Before you make or sign an offer on a tenanted home, take a few practical steps so the notice does not become a surprise.

• Confirm how many units the property has, or whether it is a condominium unit.
• Be honest with yourself about who will live in the home and when.
• Ask the seller about the tenancy: the rent, whether it is a fixed term, and the rental period dates.
• Work out when the earliest possible termination date would fall, allowing at least 60 days from the notice.
• Make sure the agreement of purchase and sale says who gives the notice and who pays the tenant's compensation.
• Keep records of your plans to move in, in case they are ever questioned.
• Have a real estate lawyer review the agreement before conditions are waived.

Frequently asked questions