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Can you afford to live in Montreal?

If you’d like to live comfortably on $45,000 (and have a working knowledge of French), move to Montreal

Montreal was recently ranked one of the best places in the world to live, an accolade awarded by the Economist magazine, which based its rankings on indicators like safety, democracy, the environment, food security, and cost of living.

There’s nothing particularly surprising about that — Canada’s second largest city, home to approximately four million people, is in the midst of a growth spurt. In 2016, it added 70,000 mostly full-time jobs to its workforce, bringing the unemployment rate to the lowest it has been since 1987. There are in fact slightly more than one million people employed on the island of Montreal alone, as of December 2016.


The most remarkable thing about this city, however, is how it’s cost of living continues to remain reasonable, despite population growth, job creation, and gentrification — all factors that tend to lead to higher home prices, rentals, and just general day-to-day expenses like transportation and groceries.

Before I get into why Montreal has successfully maintained its enviably low cost of living, let’s just take a look at how far your paycheck goes in this glorious city.

There are three points I’d like to make in reference to these numbers.

First and most obvious, rent in Montreal is dirt cheap (for a city of its size). These numbers are from the very reliable, and they show us that rent in Montreal is half that of Toronto. So right off the bat, assuming you live in a one bedroom apartment, you’re saving approximately $600 per month, on the same income you would make in Toronto.

Second, Quebec remains the province with the highest personal income tax. On a $45,000 income in Quebec, your take home pay is $33,405 as opposed to $35,380 in Ontario. It also has a compulsory deduction on your paycheck called QPIP, or Quebec Parental Insurance Plan, which basically pays benefits to self-employed and salaried workers for maternity leave, paternity leave, parental leave, or adoption leave. An extremely progressive scheme in my opinion.

Now on the surface, one would tend to associate higher personal taxes with less disposable income, but you’ll see that paying more tax in Quebec means that the government subsidizes public services, like transportation, way more than they do in most other Canadian provinces.


Which brings me to my third point — transit. When I lived in Montreal seven years ago, I used to be thrilled at the fact that I would only pay a $50 student rate for a monthly transit pass. Right now, if you live in the city, you can budget just $83 for transportation, a far cry from the hefty $145 we Torontonians pay for a monthly TTC pass. There, that’s one week of groceries in savings.

Why are Montreal rents so low?

Montreal is the kind of city where you can get a beautiful, quaint two-bedroom apartment in the heart of the Plateau Mont-Royal district for just $1,100 per month. Or if you’d like something more posh, but still centrally located, a modern two-bedroom condo lists at $2,000 a month — and that’s on the expensive end.

The primary reason why rents are lower in Montreal is because supply of rental units vastly outpaces demand. 2016 data from the Canadian Housing and Mortgage Corporation (CMHC) pegs vacancy rates of Montreal rentals (the percentage of available rental units in the city) at 3.9 percent, an increase from 2.8 percent in 2013. Last year, the Globe and Mail reported that the greater Montreal area has about 500,000 rental apartments, compared with just 100,000 in the Vancouver area, which has roughly half the population of Montreal.

Sure, people are moving into Montreal from other provinces and from abroad, and sure, jobs are being created. But keep in mind, that’s happening at a rate slower than most other major Canadian cities partly because of Quebec’s language requirements. So if you keep constructing new condos and adding rental units to the market, and there aren’t enough people to rent these apartments, your rental prices are not going to go up.

The other factor is the old age of most rental buildings in Montreal. New, glassy condominium buildings are still a bit of rarity in many areas of Montreal — young people tend to live in apartments built in the 1900s, with their signature winding staircases on the outside of the building. Older buildings cost less to maintain as they don’t come equipped with modern amenities like a gym or a pool, and, for the most part, landlords don’t upgrade the interior of these antique units. As such, it’s hard to justify high rents. Having said all this, it’s still mind-boggling to me how much cheaper it is to live in Montreal, compared to a city like Toronto that I profiled last week. And the best part is, you’re getting everything you’d want from a city (and more!) — endless diversity, a rich and vibrant arts scene, nature everywhere… I could go on.

Point is, if you have a working language of French, move to Montreal.