Housing: towards a rent freeze in 2021?

In order to prevent Montreal tenants from moving outside the metropolis, some landlords plan to not increase their rents in 2021, or even to reduce them. Meanwhile, organizations are urging Quebec to adopt a province-wide rent freeze.

Real estate developer Mondev caused the surprise earlier this week by announcing that it will freeze the price of its rents in 2021. A measure that will benefit more than 1,500 residential tenants in different central areas of the metropolis, including among others Ville-Marie, Griffintown and Old Montreal, which will see their monthly rent stagnate next year.

In a press release, the company associated this initiative with the decision taken by the mayoress of Montreal, Valérie Plante, to freeze the property taxes managed by the city-center in 2021.

“It is certain that the taxes [foncières] are 100% transferable to tenants, so the fewer tax increases there are, the less rent increases are justifiable for owners ”, raises Metro Maxime Roy-Allard, spokesperson for the Regroupement des committees housing et associations de tenants (RCLALQ). This is especially the case for newer homes, which do not need major renovations that could justify rent increases, he adds.

A trend?

Metro tried to reach several real estate developers in Montreal to find out if they too are considering a freeze on their rents next year, to no avail.

“The trend is not to increase rents [en 2021]. And in addition, the majority of landlords are ready to negotiate lower rents for certain tenants, in order to keep them ”, however affirms to Metro real estate developer Peter Sergakis, who owns thousands of homes in Montreal.

The latter also intends itself to apply a freeze or a reduction in rents for its rental accommodation which “is at market price”. However, he specifies that he could ask for a “small increase” from some of his tenants, who have been living in the same accommodation for a long time, and who are therefore currently paying a rent lower than its market value.

“Everyone needs to get through this pandemic. It is unfortunate what is happening, underlines the one who is also president of the Union of tenanciers of bars of Quebec. There is total panic and the tenants are in dire straits too. ”

Imitate Ontario

Mr. Sergakis also underlines the interest of the owners to avoid the departure of their Montreal tenants towards the suburbs.

“Strategically, if they want to keep their tenants, [les propriétaires] must also make compromises, ”says Roy-Allard. The latter nevertheless doubts that the balance of power between tenants and owners has “changed a lot” since the start of the health crisis. According to the latest data available, which dates from last January, only 1.5% of rental housing in Greater Montreal is available, unheard of in 15 years.

Instead of counting on “the charity of the owners”, the RCLALQ therefore urges Quebec to follow suit with Ontario. The government of Doug Ford recently adopted a law which will ban rent increases for all residential housing in 2021, with a few exceptions. This freeze will be in effect until December 31, 2021.

“In the context of a pandemic, it would be justified to freeze rents [au Québec], if we want to allow a large part of the population to face the pandemic, ”also believes the spokesperson for the Popular Action Front in Urban Redevelopment, Véronique Laflamme.

A sign of the impacts of the pandemic on the financial situation of Montrealers, the number of requests for food aid to 211 was still, in August, nearly double the number recorded in February, according to data compiled by Quebec Observatory of Inequalities.

“The state should force landlords to freeze rents, until we have real rent control.” -Maxime Roy-Allard, RCLALQ spokesperson

Quebec listening

In March, several tenants in Quebec threatened not to pay their rent for the month of April, because of the impact of the health crisis on their financial situation. The Legault government then implemented measures to help tenants, including offering them an interest-free loan of $ 1,500 to help them pay their rent in May and June.

Contacted by Metro, the office of the Minister of Municipal Affairs and Housing, Andrée Laforest, affirmed that this program has helped “nearly 2000 households” this summer. However, he did not comment on the possibility of banning rent increases in 2021.