Average Montreal rent to double by 2032, AI research predicts

Renting a two-bedroom apartment in Montreal will cost, on average, $4,325 per month in 2032 – an increase of nearly 106 per cent in nearly a decade.

That’s according to artificial intelligence-driven research by Concordia University.

The average rent for a two-bedroom apartment in Montreal, as of March 2023, was $2,100.

John Molson School of Business associate professor Erkan Yönder used AI to create projections that he describes as transparent and free of human bias or emotion. The AI system was trained on data from the Canada Mortgage and Housing Corporation (CMHC), Statistics Canada, and the federal government’s immigration and population projections.

Yönder explains the sharp rise in the cost of rental housing is in large part due to Canada’s immigration and housing policies being “out of sync.”

“Every year we bring new people to Canada and give a shock to the housing demand. We need to be able to provide an equal shock to the supply to stabilize the cost of rent,” Yönder said.

“This is a problem for everyone who lives in Canada.”

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In 2023 for instance, the research shows there were more than 1.2 million new Canadians, but only some 200,000 new housing units. New homes in Canada, Yönder suggests, need to be built at four to 10 times their current rate.

The research, entitled “AI-Driven Insights into Key Factors Contributing to Rental Growth Across Canada,” was commissioned by a private equity firm, Equiton Research Fund. Yönder says using a “neural network” AI, as opposed to linear, increases the accuracy of predictions by 30 per cent.

The research projects the cost of renting a two-bedroom apartment in Toronto will balloon to $5,600 by 2032 – up from $3,250 in 2023. In Vancouver, average rents will jump from $3,450 (2023) to $7,750 (2032).