Montreal housing market posts largest price increase in nine years

Aggregate home prices in the Greater Montreal area rose 6.3 per cent in the fourth quarter of 2019, real-estate company PR said.

Trees don’t grow to the sky, but maybe Montreal real-estate prices will.

Aggregate home prices in the Greater Montreal area rose 6.3 per cent in the fourth quarter to a median of $433,933, the biggest year-over-year percentage increase since 2010, real-estate company Royal LePage said Thursday in a statement. The latest jump means that Montreal-area prices have now increased by more than five per cent for three straight years, the firm said.

The trend looks set to continue this year, with Royal LePage last month forecasting a 5.5-per-cent median price increase for Montreal in 2020. Limited supply, low interest rates, a booming local economy and a steady influx of foreign and Canadian buyers are all driving up prices.

“All the elements in the economy are there to stoke consumer confidence, which translates into strong demand for real estate,” Georges Gaucher, who runs the Royal LePage Village brokerage agency in Monkland Village, said in a telephone interview. “The problem is that there are few properties on the market, which puts upward pressure on prices. As things stand now, we don’t see any factors that could cause a sudden fall in prices in 2020.”

Fourth-quarter price growth was the steepest in the Montreal East region, with an 8.7-per-cent increase, Royal LePage said. Two-storey home prices in the area rose 12 per cent to almost $600,000.

Median prices on the South Shore advanced 7.4 per cent, while those in Montreal Centre gained 7.3 per cent, Royal LePage also said.

Royal LePage’s Montreal East region includes such neighbourhoods as Hochelaga-Maisonneuve, Plateau Mont-Royal, Rosemont and Villeray. The firm defines Montreal Centre as including downtown, Griffintown and Point-St-Charles.

“The east end has always been a bit of a laggard in terms of property prices, but we’re seeing real vigour now,” Gaucher said. “There’s very little inventory in the western neighbourhoods, so buyers increasingly are turning toward the east end and the suburbs.”

Two-storey homes posted the fastest growth of all properties combined, climbing 7.2 per cent in the fourth quarter to a median of $548,374, the data show. Bungalows rose 5.9 per cent to $336,981, while condominiums advanced 4.4 per cent to $338,148.

Aggregate home prices in Montreal — a figure that reflects a weighted average of all property types — are now up 26 per cent compared with the end of 2010.

Even so, Montreal has a ways to go before catching up with other Canadian cities. Aggregate home prices for all of Canada were $648,544 in the fourth quarter — about 50 per cent higher than in Greater Montreal.

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