(Montreal) Nearly half (45%) of Quebec tenants say they spend more than 30% of their net income paying their rent, according to a new survey from Royal LePage.

As July 1 approaches, the real estate agency surveyed 742 tenants in Quebec, particularly on their intentions to become owners and their desire to save for a down payment.

The survey released Thursday indicates that about 60% of those surveyed do not plan to purchase a property in the next two years.

The reason given for half of them is that they believe they have insufficient income to buy in the neighborhood they want. And 27% argue that renting remains more affordable in the short and medium term.

But the survey highlights that the cost of rent takes up a significant part of the budget for many tenants.

Just under a quarter of respondents say they spend between 31 and 40 percent of their after-tax income on rent. For 16% of tenants, this budget item represents between 41 and 50% of their salary, while for 8% of respondents, they spend more than 50% of their income on it.

The Financial Consumer Agency of Canada recommends that rent and housing expenses should not exceed 35% of a household’s gross income.

According to the survey, just under a third say they use between 21 and 30 percent of their income for rent, and only 11 percent of respondents said they allocate less than 20 percent.

Royal LePage notes that rent prices increased by 35.5% between 2018 and 2023, based on a report from the Canada Mortgage and Housing Corporation. This trend harms the ability of tenants to save for a down payment, underlines the real estate firm.

Moreover, among those who responded that they had considered buying rather than renting before signing or renewing their lease, 37% indicated that they did not have a sufficient down payment. This encouraged them to remain tenants.

In an almost similar proportion, waiting for property prices to decrease (42%) or interest rates (41%) were also cited as factors motivating the decision to rent rather than own.

“Interest rates have increased, rents have increased too, so it’s difficult to save when you put more than 30% of your net income into housing. (Tenants) have more parameters than other previous years,” says real estate broker Geneviève Langevin of Royal LePage in an interview.

In the field, Ms. Langevin increasingly observes members of the same family who decide to come together for a joint purchase such as an intergenerational house. An interesting solution, according to her, for acquiring property.

“Sometimes I see a family buying a multiplex; the parents take the ground floor and the children are on other floors. It’s fun because it’s mutual aid and a common budget. So, purchasing power is a little more important, she relates.

Ms. Langevin believes that the Canadian charter of tenants’ rights, announced in the last federal budget, will certainly help with access to property. The proposal to count tenants’ monthly rent payments toward their credit score should make it easier, she said.

As part of the survey, renters who said they intended to buy within two years were asked what they planned to save for a possible purchase.

An equal proportion of people (23%) responded that the percentage they were considering for their down payment, relative to the value of the property, was 5, 10 or 20%, while 17% of respondents said it will be by 20%. Only 8% of participants said it will be more than 20%.

Furthermore, 40% of renters planning to purchase a property in the next two years believe they will be able to stay in their current city at the time of purchase. While 36% don’t believe they can afford it financially.

The survey was carried out by the Hill firm