Unlike other high real estate markets such as Toronto and Vancouver which had their moment of fame last year, Montreal real estate market is making its appearance this year. As the housing markets in Toronto and Vancouver are beginning to cool down, Montreal is peaking up.
Since 2010, Montreal real estate market is making a comeback with a 6% increase in home prices this year. According to the Quebec Federation of Real Estate Boards, the demand for homes in Canada’s second largest city has spiked up.
Subsequently, the demand for homes is being driven by an increase in consumer confidence and also an increase in foreign investors.
Eric Goodman, agency executive at Century 21 Vision in Montreal noted that despite the increase in the real estate activity, Montreal real estate market is still moderate in comparison to Toronto and Vancouver.
Over the past few years, Montreal’s real estate market was left in the dark as Toronto and Vancouver were at the center of attention for, but things are most likely going to take a turn as measures taken in these cities are controlling the demand rate while diverting potential buyers to other neighboring markets that are without the tax.
Speaking on the issue, Cynthia Holmes, a professor of real estate management a Ryerson University in Toronto on Wednesday stated that the chances are high for foreign investors to make Montreal their new choice of real estate investment.
She went on to add that “Montreal is the Goldilocks of the Canadian housing market” given the fact that Toronto and Vancouver have gone beyond their reach whereas Calgary is below their needs.
Following the introduction of the 15% tax in Vancouver last August, the interest of Asian investor’s in Montreal’s real estate market has increased.
In an interview on Monday, David L’Heureux, Canada Mortgage and Housing Corporation principal of market analysis for the Montreal region stated that although there has been an increase in the interest of foreign investors, it however has not affected demand in the region.
Last year, there was an increase on foreign investors’ participation in the real estate market of about 1.3%which was a 0.7% increase for 2013. However this figure is expected to have a slight increase this year.
Demand for homes in Toronto last year begun to slow down following the introduction of the tax on foreign buyers made by the British Columbia government. There was a significant decline in foreign investors in the market though it was short-lived.
Even though Toronto and Vancouver are experiencing a decrease in Non-Canadian investors, the average home price in Montreal has been on the increase with a 2% increase from last year.
Home sales in the region are also very pleasing with the figures expected to increase by 4% this year of about 41,500 properties.
So far, there is yet to be seen a spillover effect on the tax in Toronto and Vancouver on Montreal.
Paul Cardinal, Quebec real estate board market analysis manager noted that buying a home in Montreal makes more sense than buying in other expensive real estate markets, yet still buyers should be on their guard to see if Montreal will also not turn out to be like Toronto or Vancouver.