What went wrong in Montreal? Urban expansion and Montreal’s Rent Crisis

 

When I first arrived in Montreal in 2022, the city greeted me with its charm, vibrant streets, and an amazing sight that caught my eye almost everywhere: “À louer” signs plastered on countless apartment buildings. “À louer” – for rent. It felt like the city was inviting newcomers, like myself, to settle down and make a home. Finding a place to live seemed promising, and the options appeared endless.

I quickly found an apartment near to Acadie metro station that suited my needs. It wasn’t perfect, but it was affordable and gave me a space to start fresh in a new city. Over time, I grew to love my neighborhood, its Italian cafes, intercontinental markets, a very welcoming Kickboxing community "Barbukickboxing" club, and the unique charm that Montrealers exude. It felt like I had made the right choice.

But as the months turned into years, something started to change. Those “À louer” signs that had once been everywhere began to vanish. At first, I didn’t pay much attention; I thought maybe I had just grown used to seeing them and wasn’t noticing them anymore. But soon, the change became impossible to ignore. Entire streets where multiple buildings had been advertising vacancies now had none. It was like the city had quietly transformed, and the rental market had shifted under everyone’s feet.

"A LOUER" Signs were everywhere!

Meanwhile, my own situation became increasingly stressful. My landlord started raising the rent year after year, with no sign of slowing down. What made it even more frustrating was their refusal to address basic maintenance issues in the apartment. Every request for repairs seemed to fall on deaf ears. And yet, with each passing lease renewal, the rent climbed higher.

I started looking around to see if moving would be a better option, but I was quickly hit with the reality of Montreal’s new rental landscape. Apartments in my area were now listed at prices significantly higher than when I had first arrived. What had once felt like an affordable city was now slipping out of reach.

I couldn’t help but ask myself: What changed? Why had the rental market shifted so drastically? Was it the influx of new residents? The lack of new housing developments? The rise of short-term rentals? Or something else entirely?

The questions lingered in my mind as I navigated this new reality. My story is just one of many. In a city that once felt full of opportunity, many of us are now grappling with a housing market that feels increasingly unforgiving. Montreal remains a vibrant and welcoming city, but its housing challenges are a reminder of the delicate balance required to ensure that everyone can call it home.

Urban agglomeration of Montreal

As a data scientist, I decided to dig deeper into what was happening. I started analyzing urban expansion in the urban agglomeration Montreal using Sentinel-2 satellite imagery to track the growth of urban areas. I also gathered data on the number of newcomers arriving in Montreal from 2019 to 2024 and compared it with rental prices for different apartment sizes: Bachelor, 3 ½, and plus 4 ½. The data painted a clear picture of a city under pressure. Rapid population growth, combined with limited new housing developments, seemed to be driving up rental demand and prices.

A Data-Driven Look at Montreal's Housing Crisis

As I analyzed the situation further, I noticed stark contrasts between three crucial factors: rent increases, population growth, and urban build-up from 2019 to 2024.

Rent Percentage Increase

The rental market in Montreal has undergone drastic changes in just five years:

• 
  Bachelor apartments: The average rent increased by nearly 35%, from $671 in 2019 to over $902 in 2024.
• One-bedroom units: A similar trend, with rents average rising from around $824 to $1,100—a 34% increase!
• Two-bedroom units: These saw a 37% rise, increasing from $1,016 to over $1,400.
• Three-bedroom apartments or larger: The steepest rise, with rents climbing from approximately $1,285 to $1,777 a 38% increase!!!

Population Growth

Population Growth in Montreal from 2019 to 2024

Montreal experienced an unprecedented rise in population during the same period:

• Between 2019 and 2022, the growth was relatively modest, averaging about 1% annually.

However, from 2022 to 2024, population growth accelerated dramatically, peaking at an overall increase of 6% by 2024. This surge coincided with the easing of COVID-19 restrictions, increased immigration, and Montreal’s growing appeal as a cosmopolitan hub.

Tracking Build-Up Area using Google Earth Engine 

I decided to analyze urban expansion using Sentinel-2 satellite imagery. This allowed me to calculate indices like the Normalized Difference Built-Up Index (NDBI) and the Enhanced Built-Up and Bareness Index (EBBI) to quantify the city’s built-up areas from 2019 to 2024.

Calculating NDBI and EBBI

• NDBI is computed by comparing the reflectance in the shortwave-infrared (SWIR) band and the near-infrared (NIR) band of satellite images. It highlights urbanized areas.
• EBBI refines this by incorporating thermal bands, giving a more nuanced view of built-up areas and bare land.

NDBI, and EBBI indices for Montreal Island

Using these indices, I tracked Montreal’s urban footprint over five years. Initially, the built-up area expanded steadily, reflecting ongoing construction. However, starting in 2022, this trend slowed, and by 2023, the area even began to contract slightly.

Urban Build-Up Area

While rents and population figures soared, the city’s urban expansion told a different story:

• From 2019 to 2021, Montreal's built-up area expanded by 8%, reflecting ongoing construction and development.
• However, from 2022 to 2024, the built-up area contracted slightly by the approximately the same percentage. This was surprising given the increasing demand for housing.

The reduction in urbanized land during these critical years was largely attributed to the Réseau express métropolitain (REM) project. Large tracts of land were repurposed for light rail workshops, stations, and infrastructure development, effectively taking them out of the housing supply equation.

Stable, Gained, and Lost Build-Up Areas

 

Observations:

1. Rent Growth: The increase in rents far outpaced both population growth and urban expansion. By 2024, rents had risen by 35%, while the population grew by 6%, and the urban built-up area is the same.
2. Mismatch in Housing Supply and Demand: While population growth and demand soared, the urban build-up rate stagnated post-2021. The slight contraction after 2021, driven by the REM project, aggravated the mismatch.
3. Pressure on Existing Housing: The lack of new housing projects and repurposed land for infrastructure led to increased competition for existing apartments, driving rents to unprecedented level.

 

Why This Matters

The interplay between Montreal's population growth, rent increases, and stagnant urban expansion has more implications beyond just housing affordability. As the city’s built-up area did not grow to accommodate more newcomers, this expansion puts increasing stress on infrastructure, schools, healthcare facilities, and employment opportunities:

1. Infrastructure Stress: More built-up areas mean higher demands on public infrastructure such as roads, public transport, water supply, and sanitation systems. With limited expansion of urban space post-2022, existing infrastructure faces greater pressure, risking congestion, delays, and inefficiencies.

2. Schools and Education: Population growth, particularly with families moving to the city, increases the demand for schools and educational facilities. Without proportional expansion in school capacities or new constructions, overcrowding and strained resources become major challenges for public education systems.

3. Healthcare Facilities: An increasing population puts a strain on hospitals, clinics, and other healthcare resources. With a significant influx of newcomers, the city needs more healthcare professionals and expanded facilities to provide timely and adequate care to its residents.

4. Employment Opportunities: While newcomers bring vibrancy and talent to the city, the mismatch between population growth and urban development could result in increased competition for limited job opportunities. This could disproportionately affect new immigrants or those seeking entry-level positions.

5. Sustainability Concerns: The rapid urbanization and dense populations also raise environmental sustainability concerns. Striking a balance between developing new areas, conserving green spaces, and maintaining urban livability will be key for Montreal’s long-term growth.

Ultimately, while an expanding built-up area reflects growth and modernization, it also calls for strategic planning and investments to ensure the city remains a functional and equitable place for all its residents. Without addressing these challenges, the gap between Montreal’s infrastructure and its growing population risks widening further, impacting the quality of life for newcomers and long-term residents alike.

Final Reflections

As a data scientist and a resident, my exploration of Montreal’s housing landscape has been both enlightening and troubling. The numbers tell a clear story: the city’s charm has attracted many, but without sufficient housing expansion, affordability has become a growing concern. Moving forward, balancing population growth, urban development, and infrastructure projects will be critical to preserving Montreal’s vibrancy and accessibility for all.

Montreal’s parks and green spaces, alongside its metro and bus systems, are integral to its identity. However, encouraging transport infrastructure in nearby areas like Laval could distribute the influx of newcomers more evenly. From my personal experience in Laval, waiting over 40 minutes for a bus is common, reflecting its underdeveloped public transport system. Improving connectivity there could alleviate pressures on Montreal and make settling in the region more attractive.

Feel free to discover my codes on my GitHub

and here is some references where I got:

Population Growth

Renting Data