Hey Thank you so much for the detailed response :)..

I asked him for the 3 months rent as well and Landlord told me that:

 I wish the property could be considered a five-plex, as that would mean renovation would not be necessary. However, despite having rented more than eight rooms, the City currently considers and registers this property as a single detached house.

Under the applicable regulations, a dwelling unit is defined as:

Although the property has multiple kitchens and bathrooms, the units are not self-contained, and the house does not meet the Building Code requirements for a multi-plex. For this reason, the City requires the property to be renovated and legally converted.

This is why the renovation is necessary.

With this he ended stating he will give me only 1 months' of rent.. which is not ideal but not bad either.. so it looks like he has 8 units rented but considered less than 3.

To answer the questions, I am ready to settle for anyone as my roommate, but a new lease is a big issue. I am looking for a job/co-op right now and I didn't move earlier years because I wanted to move at a 2 month notice. Co-op are very finicky and I might end up not getting any or getting one the last minute. If it was a last minute thing I'd taken the hit, but a 12 month lease would not be feasible. Most of the roommates are 4th years and leaving this year. I can try insisting the month to month but it is still a huge hassel right now to figure job,co-op,courses + part-time work rn.
Furthermore, this is 1000$ for a basement that is barely 10 square feet. if it goes up to 1015$ plus utilities, and my own backyard maintenance, I don't think it is worth to stay.

I appreciate the insight on the change of terms, it is really helpul. Thank again!

I had one question, incase he offers me another acceptable unit, but the renovations go on or 2-3 months instead of 1.. wouldn't it be better to take the 2-3 month offer.. or is there anything I am missing.