Selling a Tenanted Property in Ontario: The N12 Rules No One Explains

Not for the sale itself. There is no Ontario notice that says the unit must be empty because it is being sold. The only relevant path is the N12 for purchaser occupancy: a buyer who genuinely intends to live in the unit, or to put their spouse, child, parent, or a caregiver in it.

The intent has to be real. An N12 used as a tool to deliver vacant possession to a buyer who has no plan to move in is bad faith, and the tenant can bring a T5 application after the fact for damages, including the cost of the rent difference on a new place.

Bill 60, the Fighting Delays, Building Faster Act, passed November 24, 2025. For the N12 it introduces a trade. The standard N12 needs 60 days of notice and one month of compensation paid before the termination date.

Under Bill 60, if the termination date is at least 120 days after the notice is served, and it lands on the last day of a rental period or the end of a fixed term, the one-month compensation requirement is waived. Shorter notice still triggers the compensation.

For a sale this is a planning decision. If the buyer can wait four months to move in, the longer notice can save a month of rent. If the closing is tight, budget for the compensation and serve the shorter notice. Full detail is in our Bill 60 guide and the N12 form walkthrough.

When the unit is cleared on a purchaser-occupancy N12, the person who claimed the unit is expected to actually live there for at least one year. If they move in for a few weeks and then re-list the unit for rent at a higher price, that pattern is strong evidence of bad faith.

The Landlord and Tenant Board can order substantial compensation to the displaced tenant if it finds the occupancy was a pretext. The risk does not end at closing. It runs through the first year the buyer is supposed to be living there.

Genuine intention is tested at the Board, not assumed. If the tenant files a T5 alleging bad faith, the purchaser, not just the seller, can be required to give evidence: why they need this specific unit, their living situation, and what actually happened after the tenant left.

A signed declaration helps but is not the end of it. The Board looks at conduct. A buyer who never moved in, sold again quickly, or re-rented at market will struggle. The seller who served the N12 can be on the hook alongside the buyer.

Many sellers assume vacant sells for more. Often a tenanted property with a reliable tenant and documented on-time rent sells to an investor buyer for a comparable price, with zero LTB risk and no N12 exposure.

A good tenant with a clean payment record is an asset on the listing. The buyer inherits cash flow on day one. This is exactly why a verified income and payment history on file makes the property easier to sell, not just easier to manage.

Assignment is a separate mechanism where the tenant transfers the tenancy to someone else. It is tenant-driven and not a seller's tool to clear a unit for a buyer. Do not confuse assignment with the purchaser-occupancy N12. They solve different problems and have different rules.

On closing, the buyer takes the building subject to the existing tenancy: the same rent, the same lease, the last-month-rent deposit, and any outstanding obligations. The buyer's rights start from the existing tenancy, not a blank slate.