ImmoMulti, a direct buyer of multi-unit properties on the North Shore, sees plenty of buildings whose ancillary income potential is left asleep. Shared laundry, parking rented separately, storage spaces: these income sources that add to the base rent can, when set up properly, improve your net income and — indirectly — your plex's resale value. This guide explains how to set them up, how to price them without getting it wrong, what Revenu Québec expects from you, and how to measure their real effect on your return.
What counts as ancillary income for a plex owner?
Ancillary income is income from the building that adds to the base rent: a paid laundry, parking rented separately, a locker or storage space, signage rights, or an entreposage unit. It raises net operating income without necessarily creating another dwelling.
The unit's rent pays for occupancy of the dwelling. Everything else — the parking spot, access to a shared laundry, the shed or the locker in the basement — can, depending on how it is structured, be a distinct source of income. That is exactly what separates a plex that is merely "full" from one that is optimized. In a market where profitability is tightening, these marginal revenues matter.
The starting rule is simple: income can only be "ancillary" if it is not already included in the unit's rent. If parking is part of the lease, it is part of the rent and you cannot bill for it on top with a sitting tenant. To monetize it separately, it must be excluded from the lease or covered by a distinct agreement, in line with the rules of the Administrative Housing Tribunal (TAL).
How do you set up a paid shared laundry?
The paid shared laundry is the classic ancillary income of the multi-unit. Its value depends heavily on the size of the building. In a duplex or triplex, each unit often has its own washer-dryer hookups: a shared laundry then makes little sense. From the fourplex or the building of 5 units and up, where several households have no in-unit installation, it becomes relevant.
Three formats exist:
- Coin- or prepaid-card machines: you collect on each cycle. Easy to understand, but the appliances, maintenance and collection require management.
- Leasing the machines to a supplier: a company installs and maintains the machines and pays you a share of the revenue. Less management, but a shared margin.
- Flat monthly access fee: a fixed amount per unit for access — often less optimal on revenue but predictable.
The price per cycle is set by looking at comparable buildings in your area. Above all, keep the cost logic in mind: electricity, hot water, maintenance and appliance replacement eat into gross revenue. A laundry is only profitable if the number of users and the price cover those expenses with a margin.
How do you rent a parking spot separately?
Parking is often the most profitable ancillary income, because it costs very little to maintain. Its value hinges on one dominant factor: how scarce street parking is. Near a transit hub, in a dense area, or in winter, a spot is worth a lot; in a neighborhood where everyone parks in their own driveway, it is worth little.
Three tiers of value for a spot
- Outdoor spot: the base rate, a few tens of dollars a month depending on the area.
- Sheltered or covered spot: a premium, especially in the Quebec winter.
- Enclosed garage: the highest rate, since it doubles as secure storage.
To rent it separately, the spot must not be included in the unit's lease. You can then rent it to the tenant through a distinct agreement, or even to a neighbor if the municipal by-law allows it. Set the price by checking comparable listings (Marketplace, local classifieds) rather than by guesswork. Document every agreement: that is what will make the income credible at resale.
Storage, lockers and other spaces to monetize
Storage spaces are the most underused ancillary income. Many plexes have a basement, a shed, an attic or a nook that only holds old furniture. Fitted out as individual lockers or storage units, they can be rented to tenants — for whom it is often more convenient and cheaper than a commercial self-storage unit.
Other angles exist depending on the building: a commercial or ground-floor unit in a mixed building, signage rights on a wall facing a busy street, or a secure bike space in urban areas. A caveat, though: any fit-out must respect municipal zoning, the building code and, if it is habitable space, sanitary rules. You do not turn a non-compliant basement into a rentable unit without checking the compliance of a basement unit.
Tax: how do you report this income in Quebec?
Non-negotiable point: this income is taxable. According to Revenu Québec, amounts from a rental property — laundry, parking, storage included — are rental income to be reported. The same logic applies federally with the Canada Revenue Agency.
The good news: this income opens the door to deductions. The reasonable expenses incurred to generate it — laundry electricity and hot water, appliance maintenance and repair, snow removal for the parking spot, locker fit-out — reduce the taxable net income. The golden rule: keep invoices and statements. Poorly documented ancillary income is hard to report properly and impossible to value at resale.
| Income source | Setup effort | Recurring costs | Key documentation |
|---|---|---|---|
| Shared laundry | Medium (appliances) | Electricity, water, upkeep | Collection records / supplier contract |
| Parking separately | Low | Snow removal, surface upkeep | Written distinct agreement |
| Storage / locker | Low to medium | Mainly initial fit-out | Written agreement + zoning compliance |
For guidance only. Consult Revenu Québec or an accountant for your situation. Not tax advice.
What is the real impact on the building's value?
This is where the small income shows its worth. The economic value of an income property is calculated from its net operating income (NOI) divided by the area's capitalization rate (cap rate). Every dollar of recurring net income added gets capitalized.
A concrete example: suppose $1,200 of net ancillary income per year (after expenses). At a 5% cap rate, that represents roughly $24,000 of theoretical added value ($1,200 ÷ 0.05). A modest income on the surface, but one that carries real weight once capitalized. It is the same mechanism as an under-market rent, explained in our guide on calculating a multi-unit's yield.
An essential nuance: this effect only plays out if the income is recurring, stable and verifiable in your financial statements. A savvy buyer — or a chartered appraiser — discards occasional or undocumented revenue. A parking spot rented under a written agreement for two years is valued; "$40 now and then" collected with no trace counts for no one.
Common mistakes to avoid
- Billing separately for what is included in the lease. Removing parking or laundry already included in the rent is a change to conditions that must go through the TAL procedure — not a unilateral decision.
- Documenting nothing. Without a written agreement or records, the income cannot be reported cleanly and cannot be valued at resale.
- Fitting out without checking zoning. Turning a basement or a space into a rentable area without respecting the building code and sanitary rules exposes you to municipal orders.
- Underestimating costs. A laundry that uses more electricity than it earns is not ancillary income — it is a disguised expense.
- Forgetting the tax. This income is taxable; omitting it exposes you to reassessments by Revenu Québec.
The takeaway
Ancillary income only has value if it is properly framed (lease, TAL), well documented (agreements, invoices) and correctly reported (Revenu Québec). Set up right, it raises your net income and, through capitalization, your plex's value.
