How to cool the Ontario housing market without hurting ordinary people

Recently in the news: Bank of Canada governor Mark Carney wants to cool the housing market.

This made me think of subsection 6(2) of the Ontario Residential Tenancies Act, which states:

(2)  Sections 104, 111, 112, 120, 121, 122, 126 to 133, 165 and 167 do not apply with respect to a rental unit if,

(a) it was not occupied for any purpose before June 17, 1998;

(b) it is a rental unit no part of which has been previously rented since July 29, 1975; or

(c) no part of the building, mobile home park or land lease community was occupied for residential purposes before November 1, 1991. 2006, c. 17, s. 6 (2).

Section 120 of the ORTA applies to the guideline rent increase, which means that properties that were built or started being rented out after 1998/1975/1991 (as applicable) are exempt from the rent increase guideline, and the landlords can raise the rent by however much they want.

So to cool the housing market, they should either remove this exemption, or place a time limit on it like there was in 1992.

From the point of view of an ordinary person hoping to break into the housing market simply to purchase a place to live in, the problem with the housing market is investors. They have lots of money and go in buying up condos en masse to rent out and perhaps later flip, taking them away from those of us who need to be prudent and evaluate a unit from the perspective of "How would I feel about pouring my life's savings into this and living here for the rest of my life?"

If the exemption from the guideline rent increase is eliminated, rental properties will be less attractive investments. It wouldn't make them completely unattractive investments, but a limit in how much you can increase rent where no such limit existed before should cool the market a bit by making investors more cautious.

But this will not make condos any less appealing to ordinary buyers looking for a home for themselves.  It will simply take some of the investors out of the market and leave more units for the rest of us.

It will also have the advantage of improving long-term affordability of newer (and therefore better-quality and more energy-efficient) rental housing, thereby making better housing more accessible for everyone.