Why Toronto Residents Are Turning to Montreal for Real Estate Investment

Why Do Some People Live in Toronto but Invest in Montreal?

Montreal has become an attractive destination for real estate investors from Toronto, Vancouver and New York, drawn by its unique features and potential for higher returns. Here are five key reasons why some investors choose to live elsewhere while building their portfolios in Montreal:

1. World-Class Institutions Driving Economic Growth
   Montreal is home to renowned universities like McGill and Université de Montréal, as well as world-class hospitals, research centers, and cultural institutions. These attract a diverse, international workforce, fueling economic growth and innovation. This creates stable demand for housing, making Montreal a solid choice for long-term real estate investment.

2. Affordability Compared to Major Canadian Cities
   Montreal’s real estate market is significantly more affordable than Vancouver and Toronto. According to CREA (CREA Statistics, in the third quarter of 2024), the average price of a detached home in Vancouver is $2 million, in Toronto $1.23 million, while in Montreal, it's just $632,000. This affordability gap allows investors to enter the Montreal market at a lower cost, offering more attractive opportunities for both capital appreciation and rental yields.

3. A Gateway for Francophone Immigrants
   As the second-largest French-speaking city in the developed world, after Paris, Montreal is a preferred destination for immigrants from Francophone countries such as France, Haiti, Morocco, Algeria, and Lebanon. This steady influx of new residents continues to support housing demand and offers an opportunity for real estate investors to benefit from a growing and diverse rental market.

4. A Strong Rental Market
   More than 60% of Montrealers are renters, compared to just 35-40% in Toronto. Montreal's rental market is among the largest in Canada, with a wealth of duplexes and triplexes ideal for investors looking to grow their portfolios. The high proportion of renters provides stability for investors, as rental demand remains consistently strong.

5. Higher Rental Yields and Positive Cash Flow
   One of the most attractive features for investors is Montreal’s higher rental yields. Investors in Montreal typically see yields 150-200 basis points higher than those in Toronto, making it much easier to achieve positive cash flow. This is crucial for sustaining long-term investment success, especially when rental income can more comfortably cover mortgage payments, property taxes, and maintenance costs.

For multifamily investors looking to maximize their returns while maintaining a foothold in Toronto, Montreal offers a compelling balance of affordability, high rental demand, and stronger cash flow potential.

Ready to explore your real estate options in Montreal? Contact one of our happy brokers today for expert advice and personalized service.