Real estate isn’t just about buying and holding-it’s about knowing exactly what you’re buying. One mistake can be the difference between a profitable deal and a lesson that costs you six figures. I learned that the hard way.
Years ago, I acquired what looked like a solid six-unit residential building in Montreal. On paper, the numbers checked out. The location was promising, the rent roll was stable, and the seller provided documentation confirming six active units. Everything seemed aligned. But within months of closing, I discovered a zoning issue that changed the entire outcome.
Despite the city assessing the property as a sixplex, zoning regulations only permitted a four-unit structure on that parcel. The discrepancy wasn’t caught during due diligence-and that was on me. I had trusted the tax roll and municipal assessment without confirming zoning compliance through city planning directly. That oversight meant two units technically weren’t legal dwellings, and there was no path to legalize them under existing bylaws.
The impact? Reduced income potential, tenant turnover headaches, and a lower long-term valuation than projected. We had to adjust quickly, rework the business plan, and absorb the shortfall. It was frustrating, humbling, and expensive-but also incredibly valuable.
That experience changed how I approach due diligence forever.
Today, whether I’m looking at multifamily, land development, or commercial assets, I don’t just look at what exists-I look at what’s allowed. My team and I always verify zoning use, unit legality, and future land use policy with the city directly. We call the planning department, request written confirmation, and map out what’s possible versus what’s presumed. It’s not the most exciting part of investing-but it’s one of the most critical.
This level of detail is now baked into every deal I touch. Over time, it’s become one of my biggest differentiators in the Greater Montreal market. Investors, partners, and professionals I work with know that when I bring a deal forward, it’s not just promising-it’s airtight.
Zoning discrepancies are more common than most people think. According to the Canadian Urban Institute, over 70% of housing in major cities is built under zoning codes established more than 40 years ago. That means a lot of properties have legal gray areas that go unnoticed until it’s too late. That’s why having the right systems-and the right level of paranoia-is key to long-term success.
I share this story not to discourage, but to equip. Mistakes happen, especially early on. What matters is how you respond, what you learn, and how you evolve your process. For me, that two-unit lesson became a turning point and today, it’s one of the reasons I approach every investment with a builder’s mindset and a planner’s discipline.
If you’re active in the market or planning your first step, ask the hard questions upfront. It might just save you two units and a whole lot more.
