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By Robert Blouin, Senior Consultant, Property Tax | December 16, 2020

Solid performance during the pandemic

Good news. The multi-family residential asset class has performed better than many other asset classes during the pandemic.


Projects in development are continuing toward completion. With condo buyers either employed or receiving financial support from the Canada Emergency Response Benefit (CERB), not many buyers are pulling out of deals. Across the country in June there were 77,372 high-rise units under construction, of which 92% were sold. There were also 36,211 units in pre-construction phase, of which 78% were sold.

Newly launched developments have been able to implement distancing workarounds, like virtual tours, to promote their projects. And some companies have extended cooling-off periods, giving buyers, in some cases, up to 120 days to back out of deals. Projects that were in the pipeline but hadn’t yet launched by March when COVID-19 restrictions began, have been pushed back by about six months.

Market rental

In the early days of the pandemic there were predictions of rent and revenue collection catastrophe. CERB and certain provincial programs quickly alleviated those risks and, for the most part, rents are being paid. Still, smaller properties are more vulnerable.


With intense demand for this type of housing and various levels of government continuing to provide financial and other support, this portion of the housing market continues to expand.


While border closures and physical distancing at colleges and universities are impacting student rental demand in the short term, it is expected to pick up again when the pandemic subsides.

Overall, while rents are inching down and vacancies up, demand for multi-family residential properties continues. In fact, as the recovery of Canada’s hotel sector is stalled, there may be a growing trend of hotel to multi-family housing conversions, including affordable, market rental, seniors and student housing.

Effectively managing property tax can contribute to minimizing expenses, increasing net operating income and ultimately, the value of multifamily properties.

Robert Blouin

Senior Consultant, Property Tax, Altus Group

New challenges arising

At the same time, this asset class is experiencing emerging challenges: higher costs for health and safety requirements, threats of rent arrears, immigration decline, and recently, suspensions by Canada Mortgage and Housing Corporation on refinancing of multi-unit mortgage insurance.

Meanwhile, during the past decade, multi-family values have been increasing across the country, especially in major centres. In some major centres, land value has overtaken income value for smaller multi-family properties located in areas that allow for increased densities.

With sales volumes and property values rising to such an extent, there is a related impact on property assessments, which now require careful oversight.

Be informed, be proactive about assessments

To address these challenges, owners of multi-family residential properties must carefully manage property taxes to help reduce the risk of cash flow problems.

Get connected

Get involved with local and regional business and industry associations to keep informed about developing issues and to gain a voice in bringing concerns to the attention of government.

Conduct a property review

Transaction volume in this asset class has declined during the pandemic– few transactions have closed to date in 2020. Lacking details from recent sales means that assessors may rely more on other assessment factors.

Be prepared for assessments and appeals by regularly reviewing your property and comparing it with those that are similar. Track rent, vacancy, expenses and capitalization rates. Are the market rents used in your assessment equal to what your property is achieving? Your vacancy ratio? What were the new lease deals in 2020?

What additional expenses have been incurred to address orders and guidelines from government and health authorities, such as those related to health and safety protocols including cleaning, maintenance, and physical distancing measures?

Be ready

Ensure that all financial statements and records are up to date and documentation can be produced quickly.

Looking forward: continuing demand but bumps in the road

Demand for multi-family residential properties is expected to continue. Values are holding right now but there will be bumps in the road.

With the restart of the economy being uneven across the country and among industry sectors, many renters may be out of work for the foreseeable future. Pandemic disruptions may also lead to challenges with deal closings and delayed building completions.

Multi-family residential property developers, owners, investors and operators need to keep a vigilant eye on the bottom line – and the property taxes that will hinder or help it.

Robert Blouin

Senior Consultant, Property Tax, Altus Group

Managing Property Taxes Through a Pandemic report cover

Manage property taxes for all of your assets, through the pandemic

To help you closely align property tax mitigation strategies with the current marketplace, this white paper presents a current picture of the challenges facing nine distinct asset classes in the time of COVID-19, along with steps to mitigate the impact of this consequential expense.

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