The real estate boom of the past two years has seen a slowdown in terms of sales in Quebec for several months, but the market remains very tight due to a particularly thin inventory.
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Since last June, property sales have fallen by an average of approximately 23% each month in Quebec compared to the previous year. However, these remain excellent compared to the pre-pandemic period.
Photo Didier Debusschere
Nicolas Geoffroy-Brûlé, agency manager at RE/MAX, points out that the market is still very tight, even if sales have fallen.
However, this slowdown is not due to a decrease in enthusiasm, experts point out, but rather to a number of active listings which is visibly falling.
By way of comparison, out of 21,789 properties listed, 8,891 were sold last February, according to the Association professionnelle des courtiers immobiliers du Québec (APCIQ).
For the same period in 2018, there were 1,654 fewer sales for an inventory of 68,973 units.
Several factors
“This shortage is sure to create significant pressure on the market and on prices, which have been rising again for a few months”, underlines Nicolas Geoffroy-Brûlé, agency manager at RE/MAX.
Photo Didier Debusschere
The median price of single-family homes in Quebec fell slightly last summer, before rising again. It is now at $422,000, up 57,000 in five months.
But scarcity is not the only factor that influenced this price increase, according to Charles Brant, director of the ACPIQ’s Market Analysis Department.
The announcement of an increase in the Bank of Canada’s key rate in October, which finally materialized in early March, going from 0.25% to 0.5%, frightened more than one.
“A lot of people prequalified with their bank and tried to get into the market before interest rates went up,” says Brant.
Towards some stability
In nearly two years, the median price of single-family homes sold in Quebec has exploded by nearly 62%, but the two experts believe that the situation could slowly stabilize in the coming months.
Not to mention a return to a buyer’s market, “we’re coming to the end of this [surchauffe]“, predicts Mr. Brant.
The rise in the cost of living, new real estate projects, the decline in the pool of buyers and a possible exit from the pandemic, all of this could bring the market back to what we knew before the health crisis.
Many new owners will also find themselves having to sell their property when they are overtaken by rapidly rising interest rates, it is estimated.