Return on a plex in Montreal in 2026: cap rate, gross rent multiplier, cash flow, the full example on an $874,000 triplex and the three calculation traps

Plex · Return · 2026

An $874,000 plex renting for $4,500 a month does not "pay for itself", and the math shows it in ten lines. Here are the cap rate, the multiplier, the real cash flow, and the three mistakes that make people overpay.

A plex's return reads in three numbers, and the first is not the rent. The cap rate (net operating income divided by price): on an $874,000 triplex, the Montreal area's median price in the second quarter of 2026, fully rented at $1,500 per unit (for illustration), rents come to $54,000 a year; taxes (about 1% of value), insurance and maintenance (1%) remove about $19,880; net income is about $34,120, a cap rate of about 3.9%, below mortgage rates of 4.24%. The gross rent multiplier (price divided by annual rents): 16.2, against 12 to 16 ten years ago. Cash flow: with 20% down ($174,800) and a $699,200 loan at 4.24% over 25 years, debt service is about $45,234 a year; cash flow is therefore negative by about $11,114 a year, which principal repayment (about $19,578 in year one) and appreciation must offset. The math says what the market says: in 2026, a fully rented Montreal plex at the median price is bought for equity and appreciation, not cash flow; it becomes cash-positive with a unit occupied by the owner (replacing a rent or a house mortgage), rents close to market, or a price below the median.

The full example, for illustration

The $1,500 rents are an assumption; in an older plex, leases in place are often at $900 or $1,100 and only rise at the TAL's pace (3.1% in 2026). Replace with the actual rents of the leases, not the listing's "potential" rents.

The three traps

Theoretical rents: a listing showing "potential income" or market rents for units occupied for fifteen years sells a building that does not exist; demand the leases, the renewal notices and the deposit statements for the last twelve months. Forgotten expenses: taxes on the 2026 roll (often up after a sale, as value is adjusted), income-property insurance, real maintenance (roof, brick, outdoor stairs, 1950s plumbing), vacancy, management (5% to 8% if delegated), and the non-deductible welcome tax (≈ $13,300 in Montreal on $874,000). Housing law: the increase capped by the TAL, repossession impossible for a protected tenant, eviction suspended until June 2027: a low-rent plex gains value slowly, which the price must reflect. A cap rate below the mortgage rate means every borrowed dollar costs more than it earns: that is the case at the median price in 2026, barring a large equity contribution or owner occupancy.

When the plex becomes profitable again

Owner-occupant: your unit replaces a $1,900 rent or a house mortgage; the math is done on your net share (see buying a plex owner-occupied). Rents near market or a vacant unit at purchase. Price below the median for a building to renovate, with RénoPlex in Montreal (up to 50% of eligible work) and a rent increase of 5% of the cost of the work per year amortized over 20 years. Long horizon: at 3% annual appreciation, the gain on $874,000 is about $26,000 a year, more than the negative cash flow, but taxable as a capital gain at resale on the rented part. Our forecasts by region are on plex forecasts 2027 (French).

Frequently asked questions

What is a good cap rate for a plex in Montreal in 2026?

At the median price, around 3% to 4%; a building finances without negative cash flow when the cap rate exceeds the mortgage rate (4.24%), which requires market rents or a price below the median.

How do you calculate a plex's return?

Net operating income (actual rents minus taxes, insurance, maintenance, vacancy) divided by price; then cash flow after debt service; then return on the down payment adding principal repaid.

Does a plex pay for itself?

Rarely in 2026 at the median price with 20% down; yes if the owner occupies a unit and counts what they no longer pay elsewhere, or with market rents.

What gross rent multiplier in Montreal?

Around 16 to 20 times annual rents at the median price with $1,500 rents; lower in the regions and on the South Shore, where rents are catching up with prices.

The plex file: plex forecasts 2027 (French), welcome tax on a plex (French) and the RénoPlex grant.

Our proof, not our promises

The Loaa & Manseur team, led by Lotfi Manseur and Loaa Al Daow, is the number 1 team at RE/MAX Platine in 2024 and 2025, 6th RE/MAX team in Quebec, 15th in Canada and in the global top 50 of large residential teams according to the official RE/MAX ranking, computed on actual transactions. Its Google profile counts 221 reviews with a 4.9 rating. Its offices are at 55 avenue de l'Équinoxe in Brossard, one bridge from the island, and every broker's licence can be checked in the OACIQ public register. Three things to verify yourself before calling us, and to demand of any other broker.

Also available in French: version française de ce guide.

Published September 7, 2026 by the Loaa & Manseur team, the number 1 team at RE/MAX Platine in 2024 and 2025, 6th RE/MAX team in Quebec, 15th in Canada and in the global top 50 according to the official RE/MAX ranking. Tell us about your project.