How to set up a rental property in Prince Edward Island

Step 1: Written lease

• No mandatory lease form in Prince Edward Island, but a written lease is strongly recommended.
• Prince Edward Island legislation terms apply to any written or verbal tenancy regardless.
• Optional standard form: https://irac.pe.ca/
• Both parties sign and keep a copy.

Step 2: Landlord insurance

• Get a rental-dwelling policy (NOT a homeowner policy) before the tenancy starts.
• Homeowner policies typically exclude rental income and tenant-caused damage.
• Consider requiring tenant liability insurance as a lease term.

Step 3: Municipal licensing

• No provincial landlord licence required in Prince Edward Island.
• Check with your city or municipality: some require a rental or business licence.

Step 4: Tenant screening

• Run a credit check and reference check with written consent from the tenant.
• Handle personal information per privacy law (PIPEDA or provincial equivalent).
• Human rights law applies: you may not discriminate on protected grounds.

Step 5: Move-in condition report

• No prescribed mandatory move-in inspection form in PEI. Documenting the unit's condition is recommended to support any future deposit claim.
• Both parties sign and date. Each keeps a copy. Attach dated photos.

Step 6: Security deposit

• Maximum: Max 1 week's rent (week-to-week tenancy) or max 1 month's rent (monthly or yearly tenancy)
• Interest: Interest accrues annually: verify the current rate with IRAC at irac.pe.ca.
• Return deadline: Within 15 days after tenancy ends.
• Security deposit max 1 week (weekly) or 1 month (monthly/yearly). Interest accrues annually. Return within 15 days.

Step 7: Rent increases & notice rules

• Notice required: 3 months' written notice, on Form 8; a landlord seeking more than the allowable amount files a Form 9 with the Rental Office
• The Director of Residential Tenancy sets the annual allowable rent increase. A landlord who wants to increase rent above that amount must file a Form 9, Landlord Application to Request Additional Rent Increase, with the Rental Office. IRAC (the Commission) hears appeals of Rental Office decisions; it does not set the guideline or receive above-guideline applications directly.
• Island Regulatory and Appeals Commission: https://irac.pe.ca/

Step 8: Records & receipts

• Know the deposit maximum: 1 week's rent for weekly tenancies, 1 month's rent for monthly or yearly tenancies.
• Keep: signed lease, deposit receipt, condition report(s), rent payment records, all correspondence.
• Dispute body: Island Regulatory and Appeals Commission, https://irac.pe.ca/