Rent Increase Quebec 2026: The TAL's New 3.1% Rule Explained

The TAL's base rent increase for 2026 is 3.1%. It applies to leases starting between April 2, 2026 and April 1, 2027, and it's the first rate calculated under a completely new method. For multifamily owners in Montreal, this changes how increases are justified and how you should model your buildings.

At VisionDev, we run this calculation every month across a portfolio of more than 20 buildings in Greater Montreal. Here's what we're seeing.

What changed in the TAL rent calculation

Until 2025, the TAL based its calculation on each building's revenues and operating expenses. Since January 1, 2026, the base increase follows the average of Quebec's general consumer price index (CPI) over three years. The new method applies to every lease-modification notice sent on or after January 1, 2026.

• Base rate for 2026: 3.1%
• Taxes and insurance: an additional adjustment is possible when they rise faster than the base rate
• Agreement: owners and tenants can still agree freely on a different increase

Which renovations can justify more than 3.1%

The reform lists the work that can justify an increase above the base rate:

• Roof replacement
• Doors and windows
• Major kitchen or bathroom renovations
• Certain energy-efficiency upgrades

Subsidies received for the work must be deducted from the calculation. If you're planning energy work, it can also help your financing. See how we refinanced a 28-unit building through CMHC's MLI Select.

What a 3.1% increase is worth to your building

A rent increase adds almost no expenses, so most of it flows straight to net operating income (NOI). On a $1,000 unit:

• 3.1% = $31/month, or $372/year
• After a 10% expense allowance: about $335 of added NOI
• At a 4.5% cap rate: about $7,400 of added value per unit

On a 12-unit building, one renewal cycle creates close to $90,000 in value. The reverse is also true: every year rents fall behind the market, the gap gets harder to close.

Rent increase notice deadlines in Quebec

For a 12-month lease ending June 30, the notice must be sent between January 1 and March 31. Miss that window and the lease renews at the same rent. The tenant has one month to respond. If the tenant refuses but stays, the owner has one month to file for a rent fixation at the TAL. Otherwise, the lease renews at the current rent.

FAQ

What is the TAL rent increase for 2026?

3.1% for leases starting between April 2, 2026 and April 1, 2027, based on the three-year average of Quebec's CPI.

Can a landlord raise rent by more than 3.1% in Quebec?

Yes, if the increase is justified by eligible major work or by tax and insurance increases. The tenant can refuse, and the TAL decides if the owner files for a rent fixation.

When do I send a rent increase notice for a July 1 lease?

For a 12-month lease ending June 30, between January 1 and March 31.

Analyzing a building? Our free Cruncher analysis tool helps you model rent scenarios and their impact on value.