Montréal, January 18, 2019 – The Régie du logement has established the applicable percentages.
These percentages are used to calculate the 2019 rent increases, in accordance with the Regulation respecting the criteria for the fixing of rent. The percentages enable the amounts attributed to each component of the calculation to be determined based on the actual expenses incurred for the building or dwelling in question.
Table 1: Applicable percentages for calculating rent increases
In Québec, lessors and lessees are free to agree on a rent increase that both consider acceptable. The lessee also has the right to refuse a rent increase proposed by the lessor. To facilitate agreements on rent increases, the Régie now provides a calculation tool on its website (www.rdl.gouv.qc.ca). The website provides both an electronic version of this form, entitled Calculation 2019 Tool, and a printable PDF version of it.
These simplified calculation tools make it possible to establish the rent increase, by taking into account the variation in municipal and school taxes, insurance, major improvements and all operating costs of the building. The paper version of the form will be available at the Régie’s 25 offices and service locations as of the second week of February.
It should be noted that the simplified calculation tools make no allowance for certain particular situations that could be the subject of a hearing before the Régie du logement, such as the provision of a new service that results in additional management costs, or an expenditure that does not benefit all the occupants of the building.
RIGHT OF REFUSAL
If the two parties cannot agree on the rent increase (or on any other modification to the lease), an application to modify the lease can be filed by the lessor with the Régie du logement no later than one month after the date of receipt of the lessee’s negative reply. It is important to note that, for dwellings in buildings constructed not more than five years earlier, a lessee who refuses a rent increase must leave the dwelling at the end of the lease if section F of the lease refers to this restriction (box checked).
APPLICATION OF PERCENTAGES
For example, the Régie provides a hypothetical calculation scenario to better illustrate the application of the Regulation respecting the criteria for the fixing of rent. NOTE that this example does not take into account the specific features of each building and dwelling. The income and operating expenses of a given building may justify a variation in rent that differs from this calculation example, particularly if the building has undergone major work.
Consequently, it is important to point out that the online calculation tool must be used to obtain a more precise estimate of the increase.
Table 2: Hypothetical calculation scenario
The estimated average basic increases in the second column were obtained by using, for each category of expense, the new percentages that apply for 2019, based on the cases submitted to the Régie du logement in 2017 and 2018.
CASES BROUGHT BEFORE THE RÉGIE
From 2013 to 2018, the Régie du logement granted an average rent increase of 2.8% for the cases that were brought before it, taking into account the capital expenditures that were submitted to it.
Table 3: Average rent increases granted by the Régie from 2013 to 2018
The years correspond to the reference period for calculating rent increases, not to the year in which the calculation was performed. The percentages granted take into account all the rent components, including taxes (municipal and school) and insurance. However, the results without capital expenditures do not take into account the major expenses attributed to the building or dwelling in question. The number of decisions corresponds to the number of calculations used in determining the average rent increases granted for each reference year.
FOR MORE INFORMATION
The specific rules that apply to rent increases for rental units (for example: time periods allowed for serving notices, particular circumstances for members of a cooperative or someone living in low-rental housing) are explained on the Régie’s website, which also provides model rent increase notices and a model reply to such a notice.
For more information: www.rdl.gouv.qc.ca
You can also reach the Régie by phone:
Montréal, Laval and Longueuil
514 873-BAIL (2245)
1 800 683-BAIL (2245)