Renovating vs. Rebuilding in Mount Royal

The most common question I field on inner-city luxury homes: do I restore the existing house, or tear it down and build new? The answer depends on three numbers.

First, the lot value. In Upper Mount Royal, a finished 60-foot lot is worth $1.6-2.1M as land. If the home on it adds less than 60% to that — meaning the total list is under $3.4M for a 60-foot lot — you're effectively pricing it as a teardown anyway.

Second, the cost to renovate. A meaningful renovation of a 1920s heritage home runs $400-600/sqft on the floor area touched. New construction in the same neighbourhood is closer to $700-900/sqft all-in. The renovation looks cheaper per foot, but the deferred maintenance — knob-and-tube wiring, lath-and-plaster walls, undersized ductwork — adds 20-30% in scope by the time you finish.

Third, the heritage covenant. If the home is formally protected, the rebuild option is partially or fully off the table. That changes the math entirely — you're committed to a restoration, and the lot's price needs to reflect that constraint.

My rule of thumb: if the existing home was built before 1950 and has architectural integrity, restoration almost always wins on resale. If it's a 1960s or 70s box on a great lot, the rebuild is the play. The middle case — a 1980s or 90s home on a strong lot — is the hardest call, and depends on the specific home.