Is Montreal and Greater Toronto Area Real Estate Headed for a Crisis? October Figures Raise Concerns



According to the Quebec Professional Association of Real Estate Brokers, home sales in the Montreal area witnessed a decline of two percent in October compared to the same period last year. This figure represents the second-lowest level of home sales recorded since the association began compiling market data in 2000. In October, Montreal recorded a total of 2,675 home sales, down from 2,740 in the previous year.

Breaking down the housing types, single-family home sales experienced a six percent decline, totaling 1,347 transactions in October compared to 1,438 during the same period last year. Similarly, condominium sales remained relatively stable, with 1,018 transactions in October 2022 compared to 1,021 in October 2021. On the other hand, plex sales, referring to small income properties, demonstrated an increase of 10 percent with 307 sales recorded, up from 279 in the previous year.


Is Montreal and Greater Toronto Area Real Estate Headed for a Crisis? October Figures Raise Concerns

Active listings in the Montreal area rose to 17,518 in October, indicating a twelve percent gain from the 15,708 listings reported a year ago. Additionally, new listings also experienced growth, climbing ten percent to 5,816 compared to 5,306 in the corresponding period last year.

Looking at the median prices across different housing types, single-family homes saw a year-over-year increase from a median price of $510,000 in October 2021 to $545,000 in October 2022. Conversely, the median price for condominiums rose from $380,000 to $390,000 during the same period. Plex properties also witnessed an uptick in median price, with an increase from $700,000 in October 2021 to $735,000 in October 2022.

These results indicate that the Montreal real estate market experienced relatively subdued activity in October, with a decline in total home sales. However, the increase in active listings and new listings suggests ongoing market activity and potential opportunities for buyers and sellers alike.

Comparatively, the Greater Toronto Area (GTA) faced a similar decline in home sales during the same period, with a 5.8 percent decrease compared to October 2021. Notably, sales of townhouses in the GTA recorded the largest decline. The Toronto Regional Real Estate Board reported that October's 4,646 home sales remained relatively flat compared to the 4,631 sales in September.

The board attributed the year-over-year slide in Toronto's real estate market to a lack of affordability and uncertainty regarding high borrowing costs. These factors have deterred many prospective homebuyers from entering the market. However, despite the increase in listings and softened sales, the average home price in the GTA reached $1,125,928, demonstrating a 3.5 percent rise from the previous October.

In the City of Toronto specifically, home sales witnessed a 2.3 percent drop in October compared to the same period in 2021, with 1,836 sales recorded. Throughout the rest of the GTA, home sales declined by 7.9 percent, totaling 2,810 transactions. The townhouse segment experienced the sharpest decline, with an 11.5 percent decrease in sales during October. Detached homes followed with a 5.7 percent decline, while semi-detached homes and condo apartments experienced drops of 3.2 percent and 2.2 percent respectively.

In conclusion, both the Montreal and Greater Toronto Area real estate marketsexperienced declines in home sales during October. Factors such as lack of affordability and uncertainty associated with borrowing costs have played a significant role in dampening buyer activity. However, the markets have also shown resilience, with increased listings and moderate price growth. Continued monitoring of the market will help determine the long-term effects of these trends on the respective regions' real estate landscapes.

Is Montreal and Greater Toronto Area Real Estate Headed for a Crisis? October Figures Raise Concerns

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