City benchmark · July 2026 · free calculator
Quebec City multi-family cap rate · Class A
4.25–5.00%
Class B / value-add: 4.75–5.75%
source: CBRE Q1 2026
What a 4.25–5.00% cap rate means for your financing
Put this cap rate next to your mortgage rate — that single comparison is the most useful thing on this page. If the cap rate is below your mortgage rate, you have negative leverage: the property earns less unlevered than the debt costs, so every borrowed dollar drags your return down and the property most likely runs cash-flow negative from day one. If it is above, borrowing amplifies your return instead.
Across much of Canada, negative leverage is simply the market condition — the national high-rise Class A multifamily cap rate was 4.51% in Q1 2026, among the lowest in North America. Investors accept the monthly deficit because they are buying appreciation and mortgage paydown rather than income. That is a legitimate thesis. It is only dangerous when it is unexamined.
Two Canadian specifics worth remembering: investment (non-owner-occupied) property requires a minimum 20% down payment with no CMHC insurance available, and the federal stress test still applies. If you are looking at 5+ units, the CMHC MLI Select program changes the maths considerably. Check your financed position with cash-on-cash return and whether a lender will fund it with DSCR.
Quebec City vs other Canadian markets
| Market | Cap rate |
|---|---|
| Quebec City (this page) | 4.25–5.00% |
| Vancouver | 3.50–4.00% |
| Toronto | 3.85–4.75% |
| London | 4.00–4.75% |
| Montreal | 4.25–4.50% |
| Kitchener-Waterloo | 4.50–4.75% |
| Ottawa | 4.50–5.00% |
| Calgary | 4.50–5.00% |
| Edmonton | 4.50–5.00% |
| Halifax | 4.50–5.25% |
| Winnipeg | 4.50–5.00% |
| Victoria | 4.50–5.00% |
| Saskatoon | 5.25–5.75% |
| Canada national — high rise Class A | 4.51% |
Source: CBRE Q1 2026 — CBRE multifamily, Class A, Q1 2026. Class B trades higher in most markets. CBRE reports multifamily yields rose across every segment in Q1 2026. Benchmarks are directional and move quarterly. See all markets in the cap rate by city guide.
Quebec City's vacancy rate rose to 2.8% and average rent to C$1,261, per CMHC's October 2025 survey. Quebec's welcome tax is set municipally, and Ville de Québec's own bracket schedule differs from both the province's base schedule and Montreal's — a distinction this page's cap rate math has to reflect on its own terms, not Montreal's.
Quebec City's rental market
The CMHC October 2025 Rental Market Survey reports the Québec CMA's purpose-built private-apartment vacancy rate at 2.8% as of October 2025 (up from 1.8% a year earlier), with average rent across all bedroom types at C$1,261 (up from C$1,143) — one of the largest year-over-year rent increases CMHC recorded across the cities in this series. For 2-bedroom units specifically, Statistics Canada's experimental rent table recorded an average asking rent of C$1,460 against an average paid rent of C$1,230 in the Québec CMA as of April 2026.
Quebec has no fixed annual rent-increase percentage like Ontario, BC or Manitoba. Instead, the Tribunal administratif du logement (TAL) confirms that a new rent-fixing calculation method took effect for lease-modification notices given on or after January 1, 2026, with the prior method still governing notices sent before that date. A landlord proposes an increase and a tenant may contest it at the TAL, which then applies this calculation grid — there is no published hard percentage ceiling to cite here, and no specific 2026 rate figure could be confirmed from TAL's primary materials for this page.
Quebec City's own welcome-tax brackets — not the provincial base, not Montreal's
Quebec's provincial welcome-tax rules set a base schedule but let municipalities raise the rate above C$500,000 (up to a 3% ceiling, except Montreal, which may go higher). Ville de Québec sets its own bracket schedule under that authority, and it is a different table from Montreal's — using it correctly for this city means using Quebec City's own brackets, not the provincial minimum or Montreal's higher upper bands.
| Bracket | Rate |
|---|---|
| Up to C$62,900 | 0.5% |
| C$62,900 – C$315,000 | 1.0% |
| C$315,000 – C$500,000 | 1.5% |
| C$500,000 – C$750,000 | 2.5% |
| Above C$750,000 | 3.0% |
Ville de Québec, droits sur mutation immobilière, 2026 tax year.
Short-term rental registration in Quebec — the principal-residence fee only
Quebec requires short-term rental hosts to hold a registration certificate through CITQ, valid for 12 months. The 2026 fee for the "résidence principale" (principal-residence) category is C$54. That figure only covers a host renting out their own principal residence — the registry does not have a verified fee for a dedicated, non-principal-residence rental property in Quebec, which is the more relevant category for a pure investment purchase, so no figure for that category is published here.
Methodology
Vacancy and average-rent figures are CMHC's October 2025 Rental Market Survey (purpose-built private apartments, Québec CMA total, all bedroom types; CMHC's own row label reads "Québec CMAs"). Asking-versus-paid rent is Statistics Canada's experimental table 46-10-0092-01 for 2-bedroom apartments, April 2026. Welcome tax uses Ville de Québec's own 2026 bracket schedule, not the provincial minimum or Montreal's schedule. The C$400,000 worked-example price is illustrative, chosen to sit inside three of Quebec City's five brackets.
Sources
- CMHC — Rental Market Survey Data Tables, Québec 2025 — accessed 2026-09-21
- Statistics Canada — Table 46-10-0092-01, asking and paid rent — accessed 2026-09-21
- Tribunal administratif du logement — Diffusion des pourcentages 2026 — accessed 2026-09-21
- Gouvernement du Québec — Droits sur les mutations immobilières — accessed 2026-09-21
- Ville de Québec — Droits sur mutation immobilière — accessed 2026-09-21
- CITQ — Droits payables aux fins d'enregistrement — accessed 2026-09-21
Frequently asked questions
What is the average cap rate in Quebec City?
Quebec City multifamily Class A cap rates run approximately 4.25–5.00% (CBRE Q1 2026, CBRE multifamily, Class A, Q1 2026). Class B product in the same market trades at roughly 4.75–5.75%. The only Canadian market CBRE recorded compressing in Q1 2026, in the High Rise Class B segment. For context, the Canadian national high-rise Class A multifamily cap rate was 4.51% in Q1 2026. Cap rate is net operating income divided by purchase price, and it deliberately excludes your mortgage — so it describes the property rather than your financed position.
Is Quebec City a good market for rental investment?
At 4.25–5.00%, the honest question is what you want the property to do. If the cap rate sits below your mortgage rate you have negative leverage — the property earns less unlevered than the debt costs, so borrowing reduces your return and the property likely runs cash-flow negative. That can still be a sound long-term position if you are buying appreciation and mortgage paydown, but it should be a deliberate decision rather than a surprise at closing.
Why are cap rates in Quebec City at this level?
Canadian cap rates broadly reflect prices rising faster than rents over many years — yield is income over price, so when the denominator outruns the numerator the ratio compresses. The spread across Canada is narrow: Vancouver sits lowest at 3.50–4.00% Class A, most markets cluster around 4.25–5.00%, and Saskatoon tops the survey at 5.25–5.75%. CBRE also reports that multifamily yields rose across every segment in Q1 2026, led by Kitchener-Waterloo, Montreal and Vancouver.
What's the difference between Class A and Class B cap rates in Quebec City?
Class A is newer, well-located, professionally managed product; Class B is older stock with room for improvement. Class B generally trades at a higher cap rate as compensation for the work and risk — about 4.75–5.75% in Quebec City, against 4.25–5.00% for Class A. The gap varies a lot by market: in Vancouver, CBRE records Class B at the same range as Class A, while Ottawa's Class B spread is much wider. If you are comparing your own deal against a published benchmark, make sure you are comparing like with like.
Does this cap rate include my mortgage?
No — and that is intentional. Cap rate is net operating income divided by price, describing the property as if you paid all cash. That is what makes it comparable across buyers with different loans. To see what your specific financed position earns, use cash-on-cash return; to check whether a lender will fund it, use DSCR.