Writing for The Globe and Mail
, columnist and market observer Eric Andrew-Gee noted that Montreal currently plays host to approximately 500,000 rental apartments, five times greater than the available units in Vancouver.
This abundant supply should be attributed to Montreal’s heritage, beginning with its incorporation as a city in 1832.
“When Montreal was being built up, decades before most of Canada’s urban areas, apartments were the standard housing unit of city life. Mortgages were virtually non-existent at the time,” Andrew-Gee wrote. “Through the 1920s, even Montreal’s upper class rented apartments on the city’s Golden Mile.”
“By the time homeownership had gained currency in postwar North America, renting had taken hold in Montreal,” he added.
Francis Cortellino, CMHC’s principal market analyst in Montreal, noted that the confluence of age and relatively small size in Montreal buildings has led to far lower maintenance costs compared to cities suffused with high-rises.
“In Montreal, 33 per cent of rental apartments are in buildings with three to five units. In Toronto and Vancouver, the figure is between 1 and 3 per cent,” the analysis quoted Cortellino as citing.
“Rent is also generally cheaper in older buildings, because they tend to be in relatively worse physical shape. That helps Montreal renters save pennies. Half of the city’s rental buildings were erected before 1960, compared with 24 per cent and 17 per cent for Toronto and Vancouver respectively.”
Adding to the prevailing environment of mild rental rates (especially when compared to the rest of the country) is the fact that Montreal is experiencing slower population growth than other major cities in Canada.
“From 2013 to 2014, despite gaining nearly 43,000 immigrants from other parts of the world, Montreal tallied a net loss of 10,000 residents to other provinces,” Andrew-Gee stated. “And while immigration to Montreal remains strong, foreign investment in real estate is negligible, accounting for about 1 per cent of new construction in the city.”
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Moderate demand and a generous supply stemming from a rich history have allowed consumers to enjoy generous rental rates in Montreal—and this combination of factors is unlikely to emerge in any other market in Canada, according to a recent analysis.