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Why Montreal rental rates are so lower than rest of the nation?

mg100

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#1
Hi

I am trying to understand why the apartments in Montreal are the lowest among the major cities in Canada.

For example, the 2-bedroom rent in Montreal is $700 per month. On the other hand, here are the rents from other metros : Toronto $1100, Vancouver $1200, Calgary $1070, Edmonton $1000, Halifax $900.

I looked at vacancy rates but didn’t find anything abnormal. Montreal – 2.5%, Toronto 1.5%, Vancouver 1.4%, Calgary 1.9%, Edmonton 3.3%, Halifax 2.4% ( these are numbers are approximate)

Can someone please shed some light on this?

Thanks.
 

James

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#2
I don't have statistical figures in front of me but I believe that despite similar vacancy rates, there is a higher percentage of renters to begin with in the city. It has always been commonplace to rent instead of buy, however that has been slowly changing over the years.
 
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#3
I don't have statistical figures in front of me but I believe that despite similar vacancy rates, there is a higher percentage of renters to begin with in the city. It has always been commonplace to rent instead of buy, however that has been slowly changing over the years.
I don't seem to understand how that answers the OP's question?

Montreal's housing price seems extremely affordable as well, for its size. I believe it is cheaper than Ottawa.
I would live in Montreal IF I can get a decent job and IF it is not that much colder! Much more beautiful than Toronto indeed.

On the other hand, I tend to believe Montreal's price is normal considering income, and it is Toronto/Vancouver that are overpriced by a good margin in both price and rent. Just by looking at similar sized cities in the US you will notice the difference.
 

James

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#4
I don't seem to understand how that answers the OP's question?

...
The implication of my previous statement is that there is an abundance of renters in the city, which is likely a factor in maintaining a lower rent level.
 

Eug

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#5
Housing prices there are also much lower, and people make less money. They have a higher tax load, and lower paid jobs in a lot of professions, as well lower employment availability. That, along with the fact the government is extremely insular, means that there isn't a strong incentive for people to move there, vs. places like Toronto or Calgary.

I did my a number of years of my post-secondary education in Montreal and while I love the city for its history and culture, I just hated the politics and government. As for jobs, my pay is over a third higher in Toronto than what my colleagues in Montreal get, for the same work. For my job, the pay in Toronto is a bit higher than the average across Canada, but within the same general ballpark mostly. In contrast, Montreal isn't even in the same league.
 
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andrewpmk

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#6
Housing prices there are also much lower, and people make less money. They have a higher tax load, and lower paid jobs in a lot of professions, as well lower employment availability. That, along with the fact the government is extremely insular, means that there isn't a strong incentive for people to move there, vs. places like Toronto or Calgary.

I did my a number of years of my post-secondary education in Montreal and while I love the city for its history and culture, I just hated the politics and government. As for jobs, my pay is over a third higher in Toronto than what my colleagues in Montreal get, for the same work. For my job, the pay in Toronto is a bit higher than the average across Canada, but within the same general ballpark mostly. In contrast, Montreal isn't even in the same league.
Montreal is a cheap place to live in general. Cross the bridges to Longueuil or Laval and you can buy houses in the suburbs for cheap ($300-400K). No long commute required. In contrast, in Toronto a normal income person cannot possibly afford to buy a house here, unless they are willing to spend 2-3 hours a day on the overcrowded GO train, overcrowded subways and overcrowded buses or driving in heavy traffic congestion (no way, no way, no way, no way will I ever subject myself to that torture), or live in really sketchy neighbourhoods. Plus in my view Montreal has a better public transit system (3 subway lines downtown, plus Montreal has the express bus systems to Longueuil/West Island that Toronto has no real equivalent of, and a suburb to suburb subway line that is actually useful), and a better road system (to get downtown you can take 15, 20, 10, Champlain Bridge, Victoria Bridge, Cartier Bridge, Lafontaine Tunnel+Notre Dame; Toronto has basically only three roads downtown - Gardiner, DVP, Lake Shore and until recently had a far left wing mayor who wanted to demolish one of those roads).
 

jeff316

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#7
Housing prices there are also much lower, and people make less money. They have a higher tax load, and lower paid jobs in a lot of professions, as well lower employment availability. That, along with the fact the government is extremely insular, means that there isn't a strong incentive for people to move there, vs. places like Toronto or Calgary.

I did my a number of years of my post-secondary education in Montreal and while I love the city for its history and culture, I just hated the politics and government. As for jobs, my pay is over a third higher in Toronto than what my colleagues in Montreal get, for the same work. For my job, the pay in Toronto is a bit higher than the average across Canada, but within the same general ballpark mostly. In contrast, Montreal isn't even in the same league.
I'm from Montréal originally (though I consider myself being from Hamilton, was there longer) and while I'm no expert, to my experience I'd agree with that. Fewer employment opportunities being the biggest challenge, lower pay being the next. My family didn't find the taxes that bad though. In my field as well the pay in Toronto is approx 20 percent higher than Montréal. (As an aside, Calgary, Edmonton, and Ottawa which are the highest paid and, strangely, the lowest paid in my field are in Vancouver, of all places. Ouch...)

A big one too is better transit/transportation oppportunities in Montreal, in my opinion, resulting in a better rent balance city-wide, less severe peaks and troughs. Toronto's poor transit keeps prices high along the subway corridors and the streetcar lines.

I'd be interested to know if Montreal has more family-sized rentals than Toronto - e.g. 3+ beds.
 
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Kenny

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#8
Immigration may be one factor.

Province Pop %Immigrants
Quebec 7,687,400 17.5
Ontario 12,792,900 52.3
Alberta 3,512,700 9.3
British Columbia 4,309,600 16.0

As a ratio of population to the percentage of immigrants, Quebec ranks as lowest among these four provinces.

A growing population puts more pressure to raise rent prices than a stable population due to supply and demand.
 

ponyboy

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#9
Perhaps part of the answer is that a lot of the new supply is not being rented out, thereby increasing rental rates for available units in Toronto?

Thought this might go here, but there may be a better thread

https://betterdwelling.com/city/tor...ied-homes-heres-where-they-are-interactive/#_

"Why Are They Empty?
I know what you’re thinking, foreign buyers! Well, foreign buyers aren’t usually census respondents so these are most likely domestic residents. AirBnB, pied-à-terre, or short-term renting are all uses I’ve heard from owners of multiple Toronto homes. The most popular reason however, is likely plain ole’ speculation. One of the consequences of living in a city with a red hot real estate market is flippers will hang on to inventory until they believe they’ve hit peak. In fact, a few months ago we observed that 1 in 3 homes in the city were being sold as never been lived in, despite many having been built a few years ago.
"
If we add in foreign buyer empty units to the empty estimates from Census respondents, then the percentage is even higher.
 

mjl08

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#12
Somewhat unrelated - but I was in Montreal last weekend and was taken aback by how many vacant storefronts I witnessed in heavy retail areas like Saint Denis, Saint Laurent and Sainte Catherine.
 
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#13
Somewhat unrelated - but I was in Montreal last weekend and was taken aback by how many vacant storefronts I witnessed in heavy retail areas like Saint Denis, Saint Laurent and Sainte Catherine.
I can't give a definitive answer, of course. But I would not be surprised if part of the problem isn't like what is happening on the Danforth: soaring rents and parking problems. Also, Montreal has sprawled considerably since the Ste-Catherine heyday of the 60s and 70s.

Saint Denis and Saint Laurent, for the record, were never heavy retail/commercial areas. (The lower part of St. Laurent, south of Ave des Pins was, but that was generations ago.) Both were mostly residential, albeit dense, with triplex-type housing. Commercial buildings would have been at major intersections. Then both streets got trendy in the 70s with the boomer crowd and so restaurants and cafes and bars opened up. A few high-end boutiques. But not much more, at least not significantly. Neither were shopping destinations per se. St. Hubert, as in St Hubert BBQ, just east of St Denis. My Mom would take me there as a child.

Ste-Catherine is a whole other story. I suspect that, like Yonge Street, time has passed it by. But just try to shop at Simon's on a Saturday. All my friends' daughters who go to Montreal think it's Mecca. Ogilvy's on the high end side does pretty well, I believe. It's possible that some of the retail has moved indoors but, TBH, I haven't shopped in the city for a while. I know a few new condos have gone up at the western end and probably their ground levels were designated retail but that hasn't happened yet. I don't really know.
 
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#14
Somewhat unrelated - but I was in Montreal last weekend and was taken aback by how many vacant storefronts I witnessed in heavy retail areas like Saint Denis, Saint Laurent and Sainte Catherine.
The tax burden is very high for commercial properties in Montreal. Much more difficult for small businesses to survive.