10. Economic Risks from Policy Pressures in Montreal’s Real Estate Market

This chapter aims to respond to the question of: How can developers navigate the regulations so as to maximize the financial viability of a real estate project? There are many new regulations being implemented in Montreal, such as the 20-20-20 by-law and the REM Tax, explained in subsequent paragraphs in this chapter; however, this chapter will focus solely on the impacts of the social housing component of the 20-20-20 by-law. This key focus has become increasingly important for cities since the aim of such by-laws are to make cities more inclusive and accessible. However, the by-laws are developing in different ways in cities around the world. This chapter focuses only on the introduction of the social housing by-law for Montreal. We will address this in three steps. First, we briefly describe the growth experienced in the real estate market to date in Montreal. Second, we outline the new policy changes for affordable housing and transit. And finally, we explore the financial impact of three potential ways in which the social housing by-laws can be enforced. We conclude with a summary of our findings.