Real Estate Market: Marked Slowdown in Montreal; still hardy in Quebec

The trend that began to appear in the province’s real estate market in recent months continued in July, with a decline confirmed in Montreal and a still robust market in Quebec City.

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The Montreal Census Metropolitan Area (CMA) recorded 3,080 residential transactions in July, down 18% from the same month in 2021.

“In continuity with what was recorded in June, the change in market dynamics is clearly confirmed. The magnitude of the rate hike in just four months has accelerated the market downturn, albeit much more slowly than in other major Canadian cities,” noted Charles Brant, market researcher for the Professional Association of Real Estate Brokers of Quebec (APCIQ).

“The direct consequence is the decrease in the proportion of sales that were completed after an overbidding process and the beginning of a price decline, with the exception of plexes when we analyze their evolution over the last two months,” he added.

However, while the metropolis’ North Shore sector saw a 3% increase in home sales, the South Shore sector fell 12%.

Much stronger slowdowns were also recorded in Vaudreuil-Soulanges (-20%), the islands of Montreal and Laval (-29%) and Saint-Jean-sur-Richelieu (-20%).

Plexes and condos were less popular with buyers with corresponding declines of 38% and 20%, respectively, from July 2021. Single-family homes, for their part, recorded a smaller decline (-12%).

And while the average single-family home price rose 10% year over year to $550,000, it was still down $30,000 from the April 2022 peak.

The median price for condominiums also saw the first price decline of the year at US$ 391,500. The median price of plexes has been stable at $776,000 for several months.

Sales in Quebec continue to rise

“The Greater Quebec City market is one of the few markets in the province and nationwide to see an increase in sales compared to the same period last year. However, this activity was partly explained by the inclusion of an increasing stock of single-family homes in the market for this time of year and compared to June for the first time since 2017 in both scenarios,” noted Mr. Brant.

“Although this increase in August and September needs to be confirmed to speak of a trend, it is a harbinger of a slowdown in the market and much weaker price growth or stabilization in the coming months,” he specified.

A total of 544 residential real estate transactions were recorded in the Quebec CMA, up 1% from July 2021.

The Quebec metropolitan area and northern periphery saw sales rise 4% and 12%, respectively, while the South Shore saw a 16% decline.

Small home sales rose 5% compared to the same month last year, when single-family homes were up 7%. Condominiums fell 11%.

The median single-family home price has remained stable since the spring ($350,000), while the median condo price has been $235,000 (+11%) and small homes $383,000 (+16%).

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