Montréal Resale Market Trends

According to the MLS® system data, the resale market in the Montréal Metropolitan Area is bucking the trend in comparison with other large Canadian cities, says the Greater Montréal Real Estate Board’s (GMREB). In June 2008, residential transactions were on the rise by 2%, which brings the decrease of sales since the beginning of the year to only 3%.

“Unlike the general trend elsewhere in Canada, the resale market in the Montréal Metropolitan Area is doing well,” says Michel Beauséjour, FCA, Chief Executive Officer of the GMREB. “Other large Canadian cities are seeing slower activity, with sales in Toronto decreasing by 14% since the beginning of the year, by 32% in Calgary and by 20% in Vancouver.”

For the Montréal Metropolitan Area, 25,519 transactions were recorded in the MLS® system during the first six months of 2008, a decrease of 3% compared to the 26,430 sales during the same period last year.

“Condominiums go against the tide recorded since the start of 2008 with a cumulative increase of sales of 7% compared to the first six months of 2007, while single-family homes show an equal decrease of 7%,” says Michel Beauséjour.

MLS® Residential Statistics Montréal Metropolitan Area - January to June 2008
		Variation
Active listings New listings Total sales Single-family Condominiums Plex (2 to 5 dwellings) Volume of sales Median price Single-family Condominiums Plex (2 to 5 dwellings)	24,771 42,791 25,519 15,232 7,330 2,693 $6,506,683,671 $225,000 $183,000 $336,950	+2 % +6 % -3 % -7 % +7 % -6 % +1 % +6 % +3 % +7 %

Source: The Montreal Real Estate Board

Condo Market Forecast: Montreal and Quebec City.

Condo markets in Montreal and Quebec City will post moderate price growth through 2012, offering solid opportunities for first-time homebuyers and feed the need for accessible, affordable housing in Quebec, according to new data released today by Genworth Financial Canada, a subsidiary of Genworth Financial, Inc. (NYSE:GNW).

Genworth’s Winter 2008 Metropolitan Condominium Outlook reports that Montreal’s average resale condo price will rise from $175,555 in 2008 to
$203,591 by 2012, while in Quebec City resale condo prices are expected to climb from an average $134,872 in 2008 to $154,304 by 2012. Prices will increase, on average, 3.5 per cent a year in Quebec City and 3 per cent a year in Montreal between 2008 and 2012.

“Condos remain an affordable and attractive option for first-time homebuyers. With the average price for a detached home in Quebec expected to exceed $269,000 this year, the condo market remains an important entry point for first-time homebuyers,” said Peter Vukanovich, president of Genworth Financial Canada.

[Read more]

Quebec Homeowners Intend to Pay off Mortgage Quickly

Canada Mortgage and Housing Corporation’s (CMHC) 2007 Mortgage Consumer Survey shows that 76 per cent of Quebecers who recently purchased a home intend to pay off their mortgage as quickly as possible, and 65 per cent of purchasers agreed that they would use extra money to pay down principal whenever they are able - over the national average of 57 per cent.

“This study confirms that Quebecers, like most Canadians, remain fundamentally cautious when it comes to managing their mortgage debt,” said Pierre Serré, Vice-President, Insurance Product & Business Development, CMHC. “The fact that new homeowners in Quebec intend to pay off their mortgages as quickly as possible, and are taking steps to do so, is a good sign.”

The 2007 national survey focused primarily on recent purchasers and also for the first time included questions on homeowner behaviour regarding mortgage debt re-payment since arranging their mortgage.

More than half (55 per cent) of recent homebuyers in Quebec are making weekly or bi-weekly mortgage payments, and three quarters of these are on an accelerated basis which has the effect of shortening the time required to payoff the mortgage. About one-third are also planning to reduce their mortgage amortization period when their mortgage comes up for renewal. [Read more]

Montreal Real Estate Board Report: February 2008

Residential Resales Pick Up in February Thanks to the Condominium

The Greater Montreal Real Estate Board (GMREB) indicated that property sales for all categories recorded a 3% increase in February 2008, according to MLS® system data, compared to the same period in 2007. Condominiums set the tone with an 18% increase in transactions.

MLS® Residential Statistics Montréal Metropolitan Area - February 2008
		Variation
Active listings New listings Total sales Single-family Condominiums Plex (2 to 5 dwellings) Volume of sales Median price Single-family Condominiums Plex (2 to 5 dwellings)	25,177 7,913 4,500 2,783 1,269 409 $1,102,172,663 $220,000 $177,000 $330,000	-3 % +6 % +3 % -2 % +18 % -6 % +8 % +8 % +4 % +6 %

“After being put to the test in January, the confidence of consumers in Quebec in February reached a level almost equivalent to the one recorded in 2007. The short term decrease of interest rates definitely encouraged this renewal of confidence and is excellent news for the real estate market,” says Michel Beausejour, FCA, Chief Executive Officer of the GMREB. [Read more]

Quebec housing starts up significantly in February

According to the latest monthly starts survey conducted by Canada Mortgage and Housing Corporation (CMHC), residential construction registered a strong increase this past month in centres with 10,000 or more inhabitants across Quebec. In fact, 2,810 housing units were started in February, or 50 per cent more than during the same period a year earlier.

The dynamics were different, however, depending on the centres. Starts rose by 51 per cent in the census metropolitan areas (CMAs) but fell by 6 per cent in the smaller agglomerations (50,000 to 99,999 inhabitants). The Montréal area stood out by being the engine of this growth. In fact, foundations were laid for 2,167 new dwellings there in February 2008, compared to 1,262 in February 2007, for an increase of 72 per cent. Housing starts went up less significantly in Saguenay (+56 per cent) and Trois-Rivières (+ 21 per cent), while they declined in Québec (-32 per cent), Sherbrooke (-10 per cent) and Gatineau (-3 per cent). The survey also revealed >>

Analysis of the Resale Market 2007

The Resale Market Reaches New Heights in 2007 with Close to 56,000 Transactions

Île-des-Soeurs, January 14, 2008 – The residential resale market reached new heights in 2007 with 55,776 transactions compiled on the Greater Montréal Real Estate Board’s (GMREB) MLS® system. Sales grew by 11% compared to 2006, which is the highest raise in five years.

“The increase in transactions, combined with an inventory of properties for sale similar to 2006, has contributed in maintaining a market that advantaged sellers in 2007,” says Michel Beauséjour, FCA, Chief Executive Officer of the GMREB. “As a consequence, price increases have been sustained, reaching in average 5% to 7% depending on the type of property, which represents two to three times the level of inflation.”

At the geographic level, the increase in sales spread to all sectors and all types of property. Furthermore, price increases were higher outside the Island of Montréal, with Lanaudière taking first place with an average price increase reaching 13%.

“During the last few years, the strong residential real estate market has been sustained by positive job creation, good consumer confidence in the economy and historically low interest rates. As a result, the price of properties in Greater Montréal has doubled since 1998,” says Michel Beauséjour.

For 2007, the volume of sales recorded in the GMREB’s MLS® system reached close to $13 billion, 19% more than in 2006.

Real Estate Snapshots
The condominium is mainly responsible for the resale market’s growth, outclassing the single-family home. In total, 12,251 sales were recorded in the GMREB’s MLS® system, compared to 10,216 in 2006, a 20% increase. The average sale price of a condominium for its part rose by 5% in 2007, settling at $211,000.

With a total of 35,728 transactions compiled in 2007 on the GMREB’s MLS® system, an 11% increased when compared to the 32,196 transactions recorded in 2006, the singlefamily home remains the most popular type of property. The average sale price reached $232,000, a 7% rise in comparison with $216,000 for 2006.

	CONDOMINIUM 2007
Administrative Region					Average Price	Variation 2006-2007	No. of transactions	Variation 2006-2007
Montréal	241 000 $	+5 %	7338	+20 %
Laval	175 000 $	+7 %	861	+5 %
Montérégie	166 000 $	+5 %	2628	+24 %
Laurentians	181 000 $	+0 %	821	+21 %
Lanaudière	138 000 $	+6 %	586	+28 %

	SINGLE-FAMILY 2007
Administrative Region					Average Price	Variation 2006-2007	No. of transactions	Variation 2006-2007
Montréal	357 000 $	+6 %	5 848	+9 %
Laval	236 000 $	+8 %	3 627	+7 %
Montérégie	216 000 $	+8 %	12 819	+10 %
Laurentians	206 000 $	+7 %	7 299	+13 %
Lanaudière	174 000 $	+10 %	5 742	+12 %

Source The Greater Montréal Real Estate Board www.cigm.qc.ca
The Greater Montréal Real Estate Board is a non-profit organization that brings together most of the real estate brokers and agents who work in the Greater Montréal area. With more than 9,000 members, it is the second largest board in Canada. Its mission is to actively promote and protect its members’ professional and business interests in order for them to successfully meet their business objectives and maintain their predominance in the real estate industry.

Changes in Home Buyers’ and Sellers’ Profiles

“The profile of home buyers will change significantly in the next few years, according to a public telephone survey conducted in September for the Greater Montréal Real Estate Board (GMREB). The survey, which is the fourth one, helps profile buyers and sellers, as well as measure their intentions over the next five years.

Buyers’ and Sellers’ Profiles

The survey showed significant differences in the profile of future buyers: they’re younger (6 out of 10 are under 40 years of age), more educated (54% have a university degree) and a higher proportion are couples without children (36%). There’s also an increase in the number of future buyers aged 60 and up. Baby boomers, however, will be slightly less active on the residential real estate market than they were in the previous years. The average family income of respondents planning on buying is $62,200.

“In the Montréal area, 55% of the future buyers will be first time buyers,” says Michel Beauséjour, FCA, GMREB Chief Executive Officer. “Among them, Generation Y – the baby boomers’ kids – will start entering the residential real estate market as owners.”

The main reason why people want to buy is to increase their living space (25% of respondents). Also, three-quarters of respondents intending to buy will be looking for resale property. Regarding the type of property they plan on buying, single-family homes remain the most popular option (58% of intentions). However, condominiums, which have been gaining in popularity in recent years, were chosen by 23% of respondents. In addition, 58% of respondents will be looking for a home that is more expensive than the one they currently live in.

Concerning the profile of potential sellers, they too are younger and more educated, and the majority (58%) do not have children. Consumers between 30 and 39 years old are the ones most likely to sell in the next five years.

Buyers’ and Sellers’ Intentions

In the Montréal region, 20% of the 1,445 respondents indicated that it was likely or very likely that they would buy property in the next five years, compared to 25% last year. “Given the confidence level, this decrease is not considered statistically significant,” adds Michel Beauséjour. “Buyers’ intentions measured in the 2007 survey are similar to the ones from the 2001 and 2003 surveys. In the years that followed those surveys, the number of real estate transactions in the GMREB MLS® system reached new highs. This leads us to believe that the market will remain very strong in the next few months.”

As far as sellers’ intentions go, since the 2006 survey, the percentage of respondents who said it was likely or very likely that they would sell their home in the next five years went from 23% to 15%. This could be a sign of a future decrease in the number of active listings.

“After seeing increases in listings every year since 2002, the number of properties for sale is now slightly decreasing in 2007, for the first time in five years,” says Michel Beauséjour. “With these survey results, it is, therefore, possible that the resale market will continue to tighten. At the very least, it will remain to the advantage of sellers.”

Methodology

The telephone survey was conducted from September 5 to October 7, 2007, with 1,445 respondents from the Montréal region. There is a 2.6% margin of error, 19 times out of 20. Among the respondents who indicated that they had already put a property up for sale, or intended to buy or sell during the next five years, 150 respondents were selected at random to be part of the target audience. The margin of error for this sample is 8%, 19 times out of 20.”

Source: Greater Montréal Real Estate Board Survey www.cigm.qc.ca