A landlord selling a rental property does not, by itself, end a tenancy in Ontario — the new owner must honour the existing lease. The only way a sale leads to eviction is if the purchaser (or their spouse, child, parent, or caregiver) genuinely intends to move in and the landlord serves a valid N12 notice after an Agreement of Purchase and Sale is signed, with at least 60 days' notice and one month's compensation. A bad-faith N12 can expose the landlord or purchaser to compensation of up to 12 months' rent.
- A property sale does not automatically end a tenancy — the new owner takes the property subject to the existing lease.
- An N12 for the buyer's own use can only be served after an Agreement of Purchase and Sale is signed, and only if the property has three or fewer residential units.
- The buyer (or their spouse, child, parent, or caregiver) must in good faith intend to live there for at least one year.
- N12 notices require at least 60 days' notice, aligned with the end of a rental period, plus one month's compensation paid before the termination date.
- If the LTB finds the N12 was issued in bad faith, tenants can be awarded compensation of up to 12 months' rent.
- A tenant who does not want to leave can dispute the application at the LTB — a listing or pending sale is not itself grounds for eviction.
A Sale Alone Doesn't End Your Tenancy
A common misconception is that selling a rental property automatically ends the tenants' leases. It does not. Under Ontario's Residential Tenancies Act, a new owner takes the property subject to any existing tenancy — the lease continues on the same terms, and the new owner simply becomes the landlord. This is true whether the tenancy is on a fixed term or month-to-month basis.
When an N12 Can Actually Be Used
The only pathway from a sale to an eviction is the N12 notice — but it has strict conditions. It can only be served:
- After an Agreement of Purchase and Sale has actually been signed — not while the property is merely listed or under negotiation
- Where the property has three or fewer residential units
- Where the purchaser, or their spouse, child, parent, or caregiver, genuinely intends to move in and live there for at least one year
An N12 cannot be validly served just because a landlord has put the property up for sale or is negotiating with prospective buyers — a signed Agreement of Purchase and Sale is a precondition.
Notice Period & Compensation
Like other N12 own-use evictions, a sale-related N12 requires a minimum of 60 days' notice, with the termination date aligned to the end of the tenant's rental period or lease term. The landlord must also pay the tenant compensation equal to one month's rent before the termination date — see our related guide on N12 own-use evictions generally for how this compares to other own-use situations.
Bad-Faith Evictions and Your Remedies
Given past concerns about N12 notices used to remove tenants and re-rent at a higher price, the LTB scrutinizes these applications closely. If the Board later finds the buyer never genuinely intended to move in — or moved out again shortly after — the tenant can pursue compensation, which can reach up to 12 months' rent depending on the specific findings. See our full guide on bad-faith evictions and T5 applications for how to pursue this.
The good-faith requirement applies to the buyer's actual intentions, not just the seller's paperwork. Buyers who plan to re-rent shortly after taking possession should not rely on an N12 to remove existing tenants.
If You're Buying a Tenanted Property
If you plan to move into a property you are purchasing, the N12 process must generally be initiated by the seller (the current landlord) before or as part of closing, since only the current landlord can serve a valid notice on the existing tenant. As a buyer, you cannot simply take possession because you now hold title — the notice, timeline, and compensation obligations apply regardless of the change in ownership.
A buyer signs an Agreement of Purchase and Sale for a duplex, intending to move into the main unit themselves. The seller serves the tenant an N12 the same week, giving 60 days' notice aligned to the end of the rental period, along with one month's compensation. The tenant disputes the application at the LTB, arguing the stated intention is not genuine — the Board will assess the buyer's actual plans and evidence at the hearing.
What to Do If You Receive an N12
- Confirm the timing. Was an Agreement of Purchase and Sale actually signed before the notice?
- Check the notice period and compensation. Does it meet the 60-day and one-month requirements?
- Decide whether to dispute. You are entitled to respond and present your case at an LTB hearing — see our guide on responding to an LTB eviction application.
- Document everything in case the buyer's good faith becomes an issue later.
Whether you're a tenant, landlord, or buyer navigating a sale, call our Toronto landlord & tenant lawyers at 416-274-2222.
Frequently Asked Questions
Not automatically. The Residential Tenancies Act does not allow eviction simply because a property is sold — the new owner must honour any existing lease that has not expired. Eviction is only possible in the specific, narrow circumstances described below.
Only after an Agreement of Purchase and Sale has actually been signed, and only where the property has three or fewer residential units and the purchaser (or their spouse, child, parent, or caregiver) genuinely intends to move in and live there for at least a year.
A minimum of 60 days, with the termination date aligned to the end of your rental period or lease term. Your landlord must also pay you compensation equal to one month's rent before the termination date.
If the Landlord and Tenant Board finds the N12 was not made in good faith — for example, the buyer never actually moved in or moved out shortly after — the tenant can be awarded compensation, which can reach up to 12 months' rent depending on the circumstances.
You can dispute the application at an LTB hearing. Serving an N12 does not end your tenancy by itself — the landlord must still obtain an order from the Board, and you have the right to respond and present your case.
If the new owner intends to continue renting out the unit rather than moving in, your existing tenancy simply continues under the new owner, on the same terms as before, unless a proper notice for another valid reason is served.
Only after your seller (the current landlord) properly serves and completes the N12 process, including the required notice period, compensation, and — if disputed — an LTB hearing and order. You cannot simply take possession because you now own the property.