New rent rules in Quebec set off fresh clash over affordability
Quebec’s move to overhaul rent controls starting in 2026 has deepened tensions between the provincial government and tenant advocates, who warned it would worsen an already strained housing market rather than cool it.
The regulation, scheduled to take effect on January 1, 2026, would tie annual rent adjustments more closely to the province’s consumer price index and accelerate cost recovery for capital repairs.
The change arrived after years of rising rents in Montreal and other centres, where Canada Mortgage and Housing Corporation (CMHC) data showed affordability has eroded as rent‑to‑income ratios climbed steadily since the pandemic.
New formula for 2026 rent hikes
Under the changes to the Regulation respecting criteria for setting rents, annual increases would be based on the average change in Quebec’s CPI over three years, with a separate health‑care component for personal services in private seniors’ residences.
The rules would also account for taxes, insurance and assistance tied to new services, and would encourag[e] landlords to maintain their properties by accelerating the recovery time for investments associated with capital expenditures through the introduction of a fixed threshold of 5%.
“After more than 40 years without a major revision, it was necessary to modernize the method for calculating rents to better reflect today’s economic and social realities,” Housing Minister Caroline Proulx said in a government statement.
“With the new method, we are offering tenants and landlords a clearer, simpler, and better-defined tool. They will now be able to rely on a predictable calculation that better reflects changes in the cost of living, while promoting the maintenance of Quebec’s housing stock.”
“This is a major step forward that will facilitate agreements while ensuring that increases remain justified and reasonable for tenants,” Proulx said.
Advocates warn of affordability crunch
Tenant groups see the reform very differently. Nearly 15,000 tenants and allies signed a petition this fall urging the government to withdraw the draft regulation.
“This regulation does little to correct the meagre regulatory framework that has allowed the housing crises to rage unchecked since 2020,” Émile Boucher, community organizer at the Regroupement des comités logement et associations des locataires du Québec (RCLALQ), said.
“The minister is neglecting her responsibilities to tenants: to rebalance the rental market, she should decree an immediate freeze on rent increases until measures ensuring real control in Quebec are put in place.”
On the group’s reading, the formula risked locking in steep increases. “The CAQ has refused to hear or respond to criticism of its regulation, which will allow increases of at least three per cent in 2026. Once again, without effective rent controls, we know that the actual increases will be much higher,” Shannon Franssen, RCLALQ’s interim coordinator, said.
RCLALQ called the measure “effectively a gift to landlords, generating an inflationary spiral by basing future rent increases on previous increases and passing on the entire cost of building renovations to tenants.”
The group urged tenants to push back at the unit level. “Tenants, you are not defenseless against these legislative attacks by our government, which seems to prioritize the transfer of wealth to landlords rather than our right to fair control of the rental market. You have rights: you can always refuse an unreasonable rent increase AND stay in your home,” Franssen said, directing renters to locataire.info for guidance.
Mortgage and rental pressures collide
In Quebec the share of after‑tax family income going to mortgage payments more than doubled over the past decade, with Montreal borrowers now devoting close to half their income to servicing home loans.
On the rental side, CMHC data showed Montreal’s purpose‑built vacancy rate remained below 1%, underscoring how tight supply had become despite signs of easing demand.
In a province where average rent hikes on turnover in Montreal reached nearly 19% in 2024, compared with under 5% for renewed leases, the design of future rent guidelines will continue to shape both tenant stability and investor decisions.
Whether Quebec’s new framework ultimately reins in rent escalation or cements it into the system could influence not only rental households, but also the trajectory of mortgage demand as more Quebecers decide whether they can afford to buy at all.
Make sure to get all the latest news to your inbox on Canada’s mortgage and housing markets by signing up for our free daily newsletter here.
