Cap Rate Calculator Montreal
A $380,000 purchase at $1,346 a month is a 2.85% cap after 2.9% vacancy.
Use in-place rent unless the unit is vacant and you can legally reprice it.
CMHC October 2025 Montréal CMA. Condo vacancy stayed well below purpose-built. Last verified October 1, 2025.
Starter assumption of 0.75% of value. Montréal's combined municipal and school rate varies by borough — replace with the tax bill.
Leave at 0 if you self-manage. 8% is a typical third-party fee.
Cap rate
2.85%
Gross yield
4.25%
Expense ratio
31.0%
Cap rate is $10,826 of NOI on a $380,000 price. It does not include mortgage payments, land transfer tax, or closing costs. TAL formula, not a flat cap.
Montréal's two-bedroom average is the lowest of Canada's large CMAs, so the cap rate is a cheaper building, not a fatter rent roll. The welcome tax is billed after closing and is not in this number. An exempt five-year-new building and a 1970s plex are not the same NOI path.
A $380,000 purchase rented at $1,346 a month, with 2.9% vacancy, produces $10,826 of NOI — a 2.85% cap rate. Vacancy last verified October 1, 2025.
How the Montreal cap rate is built
Gross rent $16,152, minus $468 of vacancy, minus $4,858 of operating costs, leaves $10,826 of NOI. Divide by $380,000.
- The $1,346 rent is CMHC's October 2025 purpose-built two-bedroom average for the Montréal CMA, up 7.2%. Turnover two-bedrooms were $1,644.
- Québec City's purpose-built vacancy was 2.4% with a $1,277 two-bedroom average. Change both fields if the building is there.
- The welcome tax (duties on transfers) is billed after closing. Run it on the Quebec land transfer tax calculator.
Vacancy in Montréal CMA
Greater Montréal's purpose-built vacancy rose for a second year to 2.9% in 2025. Newly built units ran well above that; the cheapest quartile stayed scarce. Rental condos were 2.1% vacant with a $1,826 two-bedroom average.
TAL formula, not a flat cap
Quebec has no single legislated annual cap. The Tribunal administratif du logement publishes a calculation. In 2025 the recommended increase was a record 5.9%, and CMHC says that is why Montréal sitting-tenant rents rose 7.2% even as vacancy increased. New buildings are exempt from TAL rent-fixing for five years.
Montreal cap rate FAQs
What is a typical cap rate in Montreal?
On a $380,000 Montréal CMA two-bedroom rented at $1,346 a month, with 2.9% vacancy, the cap rate is 2.85%. That is $10,826 of NOI. Change the rent to the amount on the actual rent roll.
How is cap rate calculated in Montreal?
Cap rate is NOI divided by purchase price. In Montreal, NOI starts with the Montréal CMA two-bedroom sitting rent, minus 2.9% vacancy, property tax, insurance, and maintenance. The mortgage and land transfer tax are not in the number.
Is there rent control in Montreal?
Quebec has no single legislated annual cap. The Tribunal administratif du logement publishes a calculation. In 2025 the recommended increase was a record 5.9%, and CMHC says that is why Montréal sitting-tenant rents rose 7.2% even as vacancy increased. New buildings are exempt from TAL rent-fixing for five years.
What vacancy rate should I use in Montreal?
Greater Montréal's purpose-built vacancy rose for a second year to 2.9% in 2025. Newly built units ran well above that; the cheapest quartile stayed scarce. Rental condos were 2.1% vacant with a $1,826 two-bedroom average.
Does the Montreal cap rate include land transfer tax?
No. Cap rate is unlevered operating income over price. Montreal land transfer tax or registration fees are cash on closing and belong in cash-on-cash, not here.
Cap rate calculators for other cities
Provincial defaults live on the Quebec cap rate calculator.
Sources
- CMHC 2025 Rental Market Report (Montréal CMA vacancy 2.9%, 2-bed rent $1,346)Montreal, last verified October 1, 2025
- CMHC: Rent Control and the Affordability of Rental Housing in Canada (2025)Montreal, last verified October 1, 2025
This calculator is an estimate for planning. Cap rate turns on the rent you can legally collect, empty months, and the tax bill — none of which a national average replaces. Confirm against the rent roll and the latest assessment notice.
Comparing provinces before you buy?
The national cap rate calculator ranks every province on the same price and on a typical local deal. When you are ready, get matched with a Montréal agent who has closed investment purchases in this market.