Canada’s real estate market has a new big shot, Montreal, owing to the fact that Toronto’s housing market is dying down and the period of Vancouver’s housing price increase are now well behind it. From a data collected by the Greater Montreal Real Estate Board, Montreal saw its highest sales in May, which trumped its last year’s May sales by 15 per cent. The city had not recorded sales this high since before it’s financial crisis between the years 2008-2009.
Referencing a statement made by the president of the GMREB Board of Directors, Mathieu Cousineau, “This was an exceptional month of May on Montreal’s residential real estate market.” In the past year alone, Single-family home prices have risen by six percent. Although when compared to Toronto’s recent double-digit price growth, this might seem like nothing to write home about, but for a place like Montreal, whose housing market had been making little or no progress for several years, a six percent rise is a big deal.
Just this January, the city’s real estate board foresaw a one percent price growth for the coming year, it has now changed its expectation to a six-percent price growth. Having been excluded from the Canadian real estate market for so long, Montreal was the first city many people thought of to be the next target for foreign buyers, after the Ontario government initiated a 15 per cent foreign buyers’ tax in the Greater Toronto Area.
Quite a number of well-to-do immigrants from Europe had already shown interest in the city, especially people from France, where many millionaires were seen exiting the country. However, in Toronto and Vancouver, Asian investors have not been reportedly seen trying to bypass the foreign buyer taxes. According to a statement issued to Bloomberg last week by CMHC Montreal analyst, David L’Heureux, “Montreal saw a ‘bit more’ Asian investors following Vancouver’s introduction of the tax last year.” He went on to say, “at the moment I don’t think it has a significant impact on demand.”
Right now, it is still unknown if that will change with Toronto’s foreign buyer tax which was introduced in April. Last month, Paul Cardinal of the Quebec Federation of Real Estate Boards, mentioned in a report that, “In the meantime, strong job growth and increasing migrant numbers are behind Montreal’s accelerating market.”
At the end of the day, Montreal’s real estate is still more affordable than that of Toronto or Vancouver. In May, the average price of a Single family home increased to $319,000 which is a fraction of the $1.56 million mean price recorded in Vancouver and the $1.1 million estimated price seen in Toronto last month.