Looking to buy a home? Here is the latest news in the Montreal Market
The housing market in Montreal remained relatively tempered at the beginning of 2016, and experts say that weaker economic fundamentals seem to have been behind Montreal’s more tepid demands. Fundamentals such as dynamic business activity play an important role in dictating the prices of homes in a given market, and in Montreal, there is a traditional preference for renting. Lower levels of immigration, weaker incomes, and various other factors are allowing the housing market to stay in relative reach for first-time buyers, so affordable housing prices and availability have opened the doors for a larger number of buyers to the domain of home ownership.
Moderate Increase, Lots of Choice
The Canadian Mortgage and Housing Corporation (CMHC) Housing Market Assessment Report, which was recently released for the First Quarter of 2016, states that the Montreal housing market is showing evidence of moderate over-evaluation, which reflects the slower growth in first-time buyers combined with relatively modest growth in terms of personal disposable income. This is a downgrade (which is good for the buyers’ market) compared to the last assessment released in October 2015, when a red flag was raised regarding the evidence of over-evaluation for the Montreal region.
All in all, the price growth in the Montreal area resale market remains moderate according to the CHMC.
When looking at the construction market, mainly condominiums, the number of new units built versus the number of units remaining unsold remains high in the city. Therefore, anyone on the lookout for a new condo may be lucky enough to find something, which suits their expectations in terms of pricing and location, as developers may be more lenient in order to properly manage their inventories.
All the facts point in the same direction – compared to its larger cousins Toronto and Vancouver, Montreal remains a relatively good bargain for new and seasoned home buyers.
Sales and Prices are Up
Last February, the Greater Montreal Real Estate Board released market statistics indicating a 12% increase in sales in January 2016 (2,153 residential sales), compared to January 2015. The largest increase was posted in the Vaudreuil-Soulanges area, where sales jumped by 24%. On the Island of Montreal, the increase was marked at 16%, while the South Shore saw an increase of 19%. Montreal’s North Shore and the Laval region saw more moderate increases compared to January 2015, which were at 1% and 6%, respectively.
In January 2016, single-family homes were the biggest sellers in the Montreal region with a noticeable increase of 14%, while condos saw a jump of 21% in sales and plex transactions rose by 8%. According to the Greater Montreal Real Estate Board, the median price of a single-family home on the Island of Montreal is now $412,600, a 12% increase when compared to January 2015. As the sales of single-family homes continue to rise in Montreal, this price increase has not been turning buyers away – instead, good bargains are being snatched up fairly quickly.
Mortgages as Incentives
Montreal’s lower prices pair well with the currently low mortgage interest rates offered by lenders. Ranging from 2.90% all the way down to 2.50%, these rates are very interesting for first-time buyers looking to buy into the island’s market. Although experts have been predicting a small hike in the Bank of Canada’s prime rate for quite some time now, these predictions have yet to materialize.