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Montreal is Canada’s mid-size major city and the one most closely related to its European ancestry. The demand for rental housing has remained steady in the city, seemingly in disregard to COVID-19—an unexpected turn of events which has renters and real estate investors, feeling relieved.
According to Rentals.ca one-bedroom apartments in Montreal cost, on average, $1,412 in June 2020. This is an increase of 0.1% from May 2020 and up 9.9% from June 2019.
Two-bedroom apartments cost, on average, $1,888 per month in June 2020 and that is up 7.9% from May 2020 and up 8.2% from June 2019. A significant leap in both month-over-month and year-over-year statistics. It seems the pandemic has not negatively affected the market at all in this category. What’s the reason for Montreal’s hot market? A few factors are at play.
There are five neighbourhoods in Montreal that have been identified as great places to rent and/or invest money in real estate. The prime reasons being they are well priced, conveniently located to the city centre or Ottawa, or they are on the cusp of becoming ‘hot’ neighbourhoods with the advent of new transit or amenities.
These are the up-and-coming neighbourhoods, according to Rentals.ca.
The Montreal rental market isn’t slowing down, or at least, Coronavirus hasn’t inflicted the same permanent dent in its side as it has in other Canadian and American cities.
There are some future concerns because it wouldn’t be real estate if we weren’t trying to predict the future and prepare for any potential adverse outcomes.
According to Marco Fontaine, Vice President of Real Estate Development at Devimco, said in the June 16th issue of RENX.ca, “…he is optimistic about the future, but identified four risks that lie ahead: The possibility of a second wave of COVID-19, the potential for high unemployment, the fate of government support programs, and the impact of the pandemic on immigration – Montreal was expected to have between 41,000 and 44,000 immigrants in 2020, which may not be reached.”
During the week of July 13th, Montreal also experienced a tripling of Coronavirus cases. If the trend isn’t arrested, it will affect multiple social and economic areas in the city, not the least of which will be the rental housing market. Luckily, the real estate market has fared well so far, but sustained pressure on the economy by Coronavirus will mean distress for the renter and the property owner.
Rental rates may go down. However, statistics have shown that lower-income families who rent are hit hardest by job losses during economic downturns. Hopefully, the infection rates will slow down, and Montreal can continue the trend toward recovery.