Despite the rise in interest rates, real estate broker Royal LePage anticipates an increase in residential real estate prices by the end of the year, particularly in the greater Montreal area.
The broker predicts prices will increase 8% in the fourth quarter compared to the same period last year.
The comparison, however, is made with a period when prices had decreased, nuance Dominic St-Pierre, vice-president and general manager of Royal LePage for the province of Quebec, in an interview. The forecast would still represent an increase of 2.1% compared to the previous three months.
The rise in interest rates is forcing some potential buyers to delay their project, but demand remains strong, Mr. St-Pierre adds.
“There is a demand for property right now which is incredible. We talk about the lack of inventory on a recurring basis. There are many new arrivals, the population of Quebec is increasing and we need to house these people. There are simply no properties available in both the rental and resale markets. »
This enthusiasm is particularly notable in the entry-level category in a context of high prices. “If a property is well listed at the entry level, it will probably go for multiple offers. […] People are looking for places to stay, so these properties are in high demand. »
In Montreal, the number of constructions in the residential sector has reached a historic low, according to data published by the Canada Mortgage and Housing Corporation (CMHC) last week.
Their number fell by 58% in the metropolis during the first six months of the year for only 5,927 housing units under construction.
For the country as a whole, Royal LePage forecasts an average price increase of 7% in Canada compared to last year.
It is still early to issue forecasts for the year 2024, replies Mr. St-Pierre. Monetary policy is one of the unpredictable elements that confuses the issue. However, he is going to rule out a drop in mortgage rates next year.
“That doesn’t seem to be in the cards at the moment.” »
“Our very preliminary opinion is that we do not think that there will be large price increases during 2024. We do not think that prices will go down, either. We think prices will remain relatively stable. »