Real estate no longer attractive to mom-and-pop landlords in Quebec, says association

A sign advertising the sale of a duplex is shown in Montreal, Friday, March 4, 2022. THE CANADIAN PRESS/Graham Hughes

Less than two months from Montreal's moving day, the association representing Quebec landlords is calling on the government to make it easier to raise rents.

Amid a worsening rental housing crisis, the province's housing stock is at risk of being gobbled up by corporations and investment funds, warns Quebec Landlords' Association, CORPIQ.

It argues investing in real estate is no longer attractive to mom-and-pop landlords.

"It's important that we get back to an idea that it's a good investment," said Benoit Ste-Marie, director general of CORPIQ.

According to a new study commissioned by the association, rent controls that limit increases despite maintenance work and renovations are making it harder for small-time landlords to make ends meet.

Landlords in Quebec can only raise rent by $1.67 per month for every $1,000 they invest into a unit.

"In Montreal, the buildings are, what, almost 80 per cent are older than 40 years. So there are incredible needs that are coming up," said Jean-Pierre Lessard of Aviseo business consulting firm, which publihed the report. "Right now, landlords – the incentives are not in their favour."

But renters are already struggling to pay the high cost of living," said tenants' rights advocate Cedric Dussault of RCLALQ, who said raising rents is not the solution.

"If we make it even easier to raise the rent, well, the speculation will continue. It will be more and more big investors who will invest in rental housing. So no, this is clearly not a solution to making it more affordable for smaller investors."

The city needs even stricter rent controls to keep housing affordable, he said.

The study also looked at the supply of rental housing across the province and estimated that about 13,000 new units would have to be built every year for the next decade. To do that, CORPIQ is calling for looser regulations on builders.