Ancillary Income for a Plex: Laundry, Parking and Storage to Boost Your Return

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.

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.

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.

What is each ancillary income really worth in 2026?

The first question every plex owner asks is also the most poorly answered: what price should I charge? Too low, and you leave money on the table year after year; too high, and the parking spot sits empty and the locker finds no taker. There is never a universal answer: it depends on local scarcity, the type of space, and what neighbouring buildings actually charge. Here is how to reason area by area on the North Shore, where ImmoMulti buys multi-unit properties in Sainte-Thérèse, Rosemère, Blainville, Saint-Eustache, Terrebonne, Boisbriand or Deux-Montagnes.

The economic principle is identical for the three main ancillary incomes: their value is set by the gap between supply and demand within walking distance. A parking spot in a neighbourhood where every house has its own double driveway is worth almost nothing; the same spot three minutes from an exo commuter station, on a street where overnight winter parking is banned, can be worth several times more. Before setting a price, spend half an hour outside: look at the "spot for rent" signs, check local classifieds, and note what actually changes hands around your building.

A reading grid, not a rate card

The table below is not an official rate — there is no regulated rate card for ancillary income — but a grid of factors that push the price up or down. Use it to place your own space, then confirm with real comparables from your street.

Keep one rule in mind: the more upkeep a space demands, the thinner the real margin. Outdoor parking and the storage locker are the "cleanest" ancillary incomes because they consume almost nothing after setup. The laundry, by contrast, burns hot water and electricity on every cycle: its gross revenue may look high, but it is the net margin that matters for your return — and it is the net margin that gets capitalized at resale.

"Advertised" income is not "proven" income

On the North Shore, ImmoMulti regularly sees sellers advertise flattering ancillary income that does not survive verification. A "$60 a month of parking" that appears nowhere in the financial statements, with no written agreement, counts for no serious buyer and no chartered appraiser. Conversely, parking documented for two years, with signed agreements and matching bank deposits, is added fully to net operating income. The price you ask matters less than the income you can demonstrate. Treat every ancillary dollar as something you will one day have to prove to a stranger reading your financial statements, and you will build revenue that actually lifts the sale price.

Shared laundry: how do you calculate the real profitability?

The laundry is the ancillary income that fools the most owners. Gross revenue looks attractive, but between hot water, electricity, maintenance and appliance replacement, the real margin can melt away — even turn negative in a small building. Here is how to do the math properly, format by format, rather than relying on an impression.

The three formats, costed out

Let's revisit the three setups presented earlier, this time with their full economic logic. The amounts are illustrative: adjust them to your appliances, your Hydro-Québec electricity rate and the number of households that will actually use the installation.

The coin/card format maximizes gross revenue but concentrates the risk and management on your shoulders: you replace the pump that fails, you absorb the electricity increase. Leasing to a supplier transfers those worries in exchange for a commission: less revenue, but no midnight calls and no upfront outlay for the machines. The flat fee in the lease smooths everything into a fixed amount, handy when several households share an installation with no meter.

The break-even calculation, step by step

To know whether a laundry is worthwhile, compare the net revenue to what each cycle actually costs. Proceed like this:

1. Estimate the volume. Count the households without in-unit hookups, then multiply by a realistic number of loads per week. A typical household does several loads weekly; multiply by 52 for the year.
2. Cost out the gross revenue. Annual cycle volume × your price per cycle (wash + dry).
3. Subtract the variable costs. Each cycle uses hot water and electricity. Drying is especially energy-hungry. Add those costs per cycle and multiply by volume.
4. Subtract the fixed annual costs. Maintenance, repairs, and above all the depreciation of the appliances: a commercial washer and dryer do not last forever. Spread their purchase cost over their useful life.
5. Compare. If the net revenue (after variable and fixed costs) stays positive and meaningful, the laundry is profitable. If it hovers near zero, leasing to a supplier becomes more attractive — you collect a commission with no risk rather than a phantom margin.

The most common lesson: in a duplex or triplex where each unit already has its own hookups, a shared laundry often has no economic value. It is from the fourplex, the five- or six-unit building up, when several households share a single installation, that the volume justifies the appliances and the upkeep.

Renting a parking spot separately: the procedure

Parking is the most profitable ancillary income because it costs almost nothing to maintain. But to monetize it cleanly — and above all for it to count at resale — you have to take it correctly out of the unit's lease. Here is the step-by-step, from the owner-seller's point of view.

1. First check what is in the lease. If the spot is already included in the rent of an occupied unit, it is part of the lease conditions. You cannot remove it or bill for it on top to the sitting tenant unilaterally: that is a change to the lease conditions, governed by the Administrative Housing Tribunal.
2. For a unit that turns over, you have full latitude: when renewing or signing a new lease, explicitly exclude the spot and offer it as a distinct service, priced against area comparables.
3. Draw up a separate written agreement. Whether the spot is rented to the tenant or a neighbour, the agreement must state the location, price, term, cancellation conditions and liability for damage. That document turns "income now and then" into provable income.
4. Check the municipal by-law. Some North Shore municipalities limit renting parking to non-residents of the building or require a minimum number of spaces per unit. Confirm with your planning department before renting to a third party.
5. Document the collections. Bank deposits, receipts, statements: every dollar must leave a trace. At resale, a buyer — or a chartered appraiser — only adds to net income what is verifiable.

Outdoor, sheltered or garage: three different markets

One spot is not the other. The outdoor spot is the floor rate; the shelter or carport adds a premium, particularly valuable in the Quebec winter when snow removal becomes a service in its own right; the enclosed garage commands the highest rate, because it combines two uses — parking and secure storage. If your garage has a 240 V outlet, you hold a growing asset: EV charging becomes a rental argument and, in time, a distinct ancillary income.

Beyond the classic trio: the overlooked ancillary incomes

Laundry, parking and storage are the three pillars, but a well-observed plex often holds other income sources most owners ignore. None is magic, and all demand the same rigour — written agreement, zoning and building-code compliance, tax reporting — but added together, they can make a real difference to net income.

Two warnings apply to all these angles. First, zoning and the building code come first: you do not turn a nook into a rentable unit, or a roof into an antenna mount, without confirming the use is permitted and safe. Second, profitability must be net: a vending machine that costs more in electricity and restocking than it earns is not income — it is a nuisance. As with the classic trio, keep only what is recurring, documented and reported.

Be careful, too, not to drift into short-term tourist accommodation while thinking you are "making a space pay." Airbnb-style rental in a plex follows a distinct, far stricter regulatory regime — it is not ancillary income, but a change of use.

The legal framework: lease, services and dependencies

The whole edifice of ancillary income rests on one distinction: what is included in the rent and what is not. In Quebec, the residential lease covers the dwelling but also its services, accessories and dependencies — that is, everything the tenant enjoys under the lease: a parking spot that is mentioned, access to a laundry, an assigned storage space. What is included cannot be billed on top or removed at will.

Two situations, two degrees of latitude

For an occupied unit whose lease is renewing, your latitude is narrow: removing an included service (parking, laundry, storage) or billing it separately is a change to the lease conditions. It requires notice to the tenant within the prescribed time limits, and the tenant can refuse; the dispute is then settled before the Administrative Housing Tribunal. You do not "decide" alone to start charging for parking that was previously included.

For a unit that turns over, by contrast, you start from a blank page. In the new lease you can explicitly exclude parking, laundry or storage from the rent and offer them as distinct services. It is the prime strategic moment to restructure your ancillary income — without conflict and without a procedure.

To dig deeper into the role of leases in a building's value and sale, see our guide on selling a plex with active leases. A building whose ancillary income is clearly framed in the lease sells better than one with "informal" revenue.

Case study: a six-plex before and after optimization

Numbers speak louder than principles. Take an illustrative example — a six-plex on the North Shore, six units rented at market, no structured ancillary income at the outset. The amounts serve only to show the mechanism; adapt them to your real building.

The starting point

At purchase, the building shows only its base rents. A six-space parking lot exists, but it is vaguely "included" and never billed. The basement serves as a junk room. No shared laundry: three of six households have no hookups and go to the corner laundromat.

The optimization plan, unit by unit

The owner disrupts no one: he acts as units turn over, restructuring each lease that frees up.

1. Parking. As units renew, four of the six spaces are taken out of the rent and rented separately under distinct agreements; two stay included for long-time tenants.
2. Shared laundry. A prepaid-card washer and dryer are installed in a basement room, used by the households without hookups.
3. Storage. The rest of the basement is partitioned into lockers rented to tenants who want them.

Why turnover timing is the key

Notice what the owner did not do: he did not knock on doors demanding that long-time tenants start paying for parking they had always used. That path leads straight to the Administrative Housing Tribunal and to resentment. Instead, he let natural turnover do the work. Each time a unit freed up, he rebuilt the lease from scratch — base rent on one side, parking, laundry access and storage priced as clearly excluded, distinct services on the other. Over two or three years, most of the building was quietly restructured, without a single dispute. This patience is not a weakness; it is the safest route to income that is both legally sound and fully documented — the only kind that survives a buyer's due diligence.

The same restraint applies to the physical work. The laundry room and the storage lockers were fitted out once, with proper invoices kept for every dollar spent, so that the capital cost could later feed the depreciation calculation and the resale narrative. Nothing here relies on cash changing hands informally; everything leaves a paper trail. That is precisely what turns a vague "the building also makes a bit on parking" into a line an appraiser will actually credit.

The effect on value

This is where the magic of capitalization plays out. The economic value of an income property is obtained by dividing the net operating income by the area's capitalization rate (cap rate). Suppose the optimization adds $3,000 of net ancillary income per year, well documented. At a 5% cap rate, that represents roughly $60,000 of theoretical added value ($3,000 ÷ 0.05). At a 6% cap rate, roughly $50,000. The same income, capitalized, is therefore worth ten to twelve times its annual amount.

The condition, repeated but essential: this income must be recurring, stable and verifiable. A savvy buyer or a chartered appraiser gives no value to income that is "advertised" but nowhere to be found in the financial statements. The same capitalization mechanism is detailed in our guide on calculating a multi-unit's yield.

Advanced tax: deductions, CCA, GST/QST and books

Ancillary income follows the same tax logic as rent: it is taxable, but it opens the door to deductions. Kept properly, the accounting for this income lowers tax and, above all, makes every dollar valuable at resale. Here are the points every plex owner should master — bearing in mind that each situation deserves the advice of an accountant or tax specialist.

What you can deduct

The reasonable expenses incurred to generate the income reduce taxable net income. For ancillary income, this typically includes:

• The electricity and hot water attributable to the shared laundry;
• The maintenance and repairs of appliances and spaces;
• The snow removal and surface upkeep of rented parking spots;
• The initial fit-out of lockers (depending on whether it is a repair or a capital improvement);
• The depreciation of appliances and certain equipment.

The current expense vs capital expense distinction is crucial. A repair that restores an appliance is generally deductible immediately; buying a new appliance or a durable fit-out is a capital expense, recovered through capital cost allowance (CCA) over several years. According to the Canada Revenue Agency, furniture and appliances in a rental property generally fall under Class 8 (20%).

GST and QST: the point that surprises

Long-term residential rental (occupancy of one month or more) is exempt from GST and QST: you charge no tax on the rent. Parking or storage provided to your own tenant, as an accessory to their exempt residential rental, generally follows the same treatment. On the other hand, a space rented to a third party who is not your residential tenant — a spot rented to the neighbour, signage rights, an antenna lease — can be a taxable supply. Tax only applies, however, if you exceed the small-supplier threshold ($30,000 in taxable supplies over four quarters). Below it, you need not register or collect tax. This point is subtle: confirm your specific case with Revenu Québec.

GST/QST rules on housing: Revenu Québec. Small supplier: Canada Revenue Agency. Not tax advice.

Keeping books that hold up

Accounting discipline is what separates "theoretical" ancillary income from income that truly raises resale value. Three reflexes: collect traceably (transfer, deposit, receipt — never cash that vanishes), keep every invoice for related expenses, and reflect it all in a return consistent with your financial statements. A buyer preparing an offer reads these documents; clean, documented income gets paid for, murky income gets ignored.

The owner's checklist before adding an ancillary income

Before launching a laundry, renting a parking spot or partitioning a basement, run every project through the same questions. This discipline avoids the two classic pitfalls: income that costs more than it earns, and income that "does not count" because it is neither framed nor provable.

A project that ticks these six boxes becomes an asset: it raises your net income, it reports cleanly, and it holds value at resale. A project that fails a single one is, at best, a complication; at worst, a dispute or a reassessment. The difference between the two lies not in the size of the income, but in the rigour of its setup.

"The value of an income property is calculated from its net operating income and the capitalization rate buyers apply. Every dollar of recurring, documented net income is capitalized; every murky or one-off revenue is discarded by a savvy buyer."

Income approach to valuation — see our yield calculation guide and the Administrative Housing Tribunal for lease rules.

That is why ImmoMulti, as a direct buyer of multi-unit properties on the North Shore, pays as much attention to well-documented ancillary income as to base rents: it is what separates a merely occupied building from a truly optimized — and therefore better-valued — 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.