The buy-demolish-rebuild model works like this: you purchase a property that has an existing tenant, collect rent during the holding/permit period (offsetting carrying costs), then legally terminate the tenancy using the N13 or N11 process once your demolition permit is secured and timeline is ready.

Why rent first? Three reasons: (1) carrying cost offset — rent income reduces your holding costs while permits are processed; (2) legal necessity — you cannot simply evict a tenant immediately upon purchase; (3) planning buffer — demolition permits often take 6–18 months in GTA municipalities, so the tenancy period aligns naturally.

When you purchase a tenanted property, the existing lease transfers automatically — you become the new landlord with all the same obligations. Review the existing lease carefully at offer stage: fixed-term vs. month-to-month, current rent amount, and any special terms.

If the tenant is on a fixed-term lease, it must run its course. If month-to-month, you can begin the N13 process once you have a demolition permit — but you still cannot serve notice until you have that permit in hand.

Use the rental income period productively: hire an architect, submit your site plan or new build drawings to the municipality, and pursue your demolition permit.

In most GTA municipalities, a demolition permit for a residential structure requires: proof of a valid building permit for the replacement structure (you generally cannot demolish without showing what you’ll build). Processing time is typically 3–12 months depending on zoning complexity.

Critical: You legally cannot serve N13 notice without a valid demolition permit in hand.

Once your permit is in progress or issued, approach the tenant directly with an N11 — Agreement to Terminate the Tenancy. This is a voluntary, mutual agreement on a specific termination date.

Structure your N11 negotiation offer: (1) Cash compensation above the legal minimum (offer 4–6 months’ rent to incentivize agreement); (2) Extended notice period to give them time to find new housing; (3) Moving allowance if appropriate.

A signed N11 eliminates LTB dispute risk and gives you a firm, agreed vacancy date. This is the cleanest outcome.

If the tenant declines a reasonable N11 offer, you proceed with the N13 — Notice to End Tenancy (Demolition, Conversion, or Repairs). Requirements:

Notice period: Minimum 120 days (not 60, not 90 — 120 days minimum for demolition).

Compensation required: Under Section 52 of the RTA, you must pay the tenant at least 3 months’ rent on or before the termination date. Failure to pay voids the notice.

Tenant’s right to dispute: The tenant can file an LTB application challenging the N13. Expect a hearing; budget 3–9 months for resolution. A valid permit and properly served notice are your strongest defences.

Once the tenant vacates (per N11 agreement or N13 order), you have a clean vacant possession. Confirm: tenant has removed all belongings, keys returned, utility transfers completed.

Proceed with demolition using your municipal permit. In GTA municipalities, demolition of a residential structure requires: utility disconnection confirmations from hydro, gas, and water before demolition begins — your contractor will coordinate these. Budget 2–4 weeks for utility disconnections.

💡 Arthur’s Key Point