In order to give respite to real estate developers faced with an increase in interest rates and construction costs, the City of Montreal has decided to suspend for two years the financial contribution for the development of affordable housing provided for in its Regulations for a mixed metropolis. A measure that will allow real estate developers to save $3,000 to $4,000 for each housing unit built in the metropolis.
This contribution will, however, continue to be required from developers in certain limited areas of the metropolis where the City wishes to further stimulate the creation of affordable housing.
At the same time, the municipal administration also limits to 5%, for two years, the annual increase in financial contributions required from developers who do not transfer land or buildings intended for social housing within the framework of this regulation. These contributions will then increase at a more sustained rate in 2026 and 2027, in order to become more dissuasive for the numerous promoters who have remitted $27.5 million since 1er April 2021 to the City rather than transfer land to it or include social housing in their projects.
“For two years, we are going to give breaka moment of respite for developers” in order to stimulate an upward recovery in construction starts in the metropolis, declared Thursday the head of housing at the executive committee, Benoit Dorais, during a press conference held in the Old Montreal.
The City, which will adopt modifications to this by-law next week, will also restrict the number of real estate developments that are subject to it. It will now only be projects of 20 housing units or more that will have to contribute financially to the development of social and affordable housing in the metropolis, whereas this requirement currently applies to any development of five housing units or more.
More details will follow.
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