Quebec changing method to calculate rent increases after record recommendation for 2025

Quebec is changing the way rent increases will be calculated – a few months after the province’s housing tribunal, known as the TAL, recommended a record average rent hike of 5.9 per cent for this year.

The changes were outlined in Quebec’s Official Gazette Wednesday and are expected to be simpler and more predictable.

“We need to reverse the trend of the past four years, the current regulation has created ideal conditions for ‘renovictions’ on a silver platter,” said Éric Sansoucy, spokesperson for the Quebec Real Estate Owners Corporation (CORPIQ).

However, tenant advocates say the government is siding with landlords at a time when renters are facing historic increases.

“Instead of supporting tenants through this period of unprecedented rent hikes, the Quebec government has chosen to stand with real estate corporations,” said André Trépanier, responsible for tenants’ rights at the Parc-Extension Action Committee (C.A.P.E.).

The old calculation was based on 13 variables, while the new one will be based on four:

• The average consumer price index in Quebec for the reference year and the three years preceding it
• Variations in municipal taxes
• Variations in school taxes
• Variations in insurance costs

If this had been used for 2025, the TAL’s recommended rent hike would have been 4.5 per cent instead of 5.9.

“There will be more rent increases in the future because the new method is tied to inflation—and rising rents are a major driver of inflation,” said Trépanier. “So higher rents will push inflation higher, which will then justify even higher rent increases.”

Despite benefiting from the old system, Sansoucy acknowledged it was no longer viable.

“We understood that, even though it was in our favor, the old method wasn’t sustainable,” he said. “We proposed using general inflation and a three-year rolling average to better reflect the real costs of owning and maintaining a building.”

Another major change announced by Housing Minister France-Élaine Duranceau is a new rule on recovering renovation costs: landlords will now have 20 years to recoup those expenses, at a fixed rate of 5 per cent annually.

“Now we’ll know exactly what it means when you invest in renovations and what the return will be,” said Sansoucy. “Previously, it could take anywhere from 20 to 50 years to recover the investment—so you might have to pay for three roofs before getting your money back for one.”

The new calculation method will be used as of next year.