The sale price of properties in Montreal continued to slide in the fourth quarter of 2022, but the slide was less steep than during the middle of the year, new data from Royal LePage revealed, released on Friday.
“In the aftermath of the pandemic, the price correction happened very quickly. The rise in interest rates had the effect of a rude awakening. But there, we seem to see a bit of a return to normality. We are getting closer to a balanced market,” observes Marc Lefrançois, chartered real estate broker at Royal LePage.
In the Greater Montreal area, the median price aggregate for single-family homes and condominiums fell by 1.9% in the last quarter of the year just ended (-3.2% for single-family homes; + 2.9% for condominiums) — a less steep drop than that observed between the second and third quarters of the same year (-5.3%).
On an annual basis, however, prices recorded a slight increase of 2.2%. “The first quarter of the year was very strong in 2022, but there was a strong decline in the subsequent quarters. In the end, we pretty much wiped out the gains made at the start of the year,” summarizes Mr. Lefrançois.
Thus, in the fourth quarter of 2022, the median sale price of a single-family home in Greater Montreal was $601,500, and $445,100 for a condominium.
Across Canada, the selling price of properties fell 2.3% in the last quarter compared to the previous one. And unlike the Greater Montreal area, which recorded an annual price increase between the last quarter of 2021 and that of 2022, the national aggregate of prices shows a drop of 2.8%.
Further declines to be expected
“We are still anticipating a few drops for the next year, even if we will not erase all the gains made during the pandemic”, also underlines Mr. Lefrançois.
In Greater Montreal, aggregate house and condominium prices could fall by 2% by the fourth quarter of 2023, compared to that of 2022. In Toronto or Vancouver, where price declines have been particularly over the past year, prices could fall by 2% and 1% respectively.
Note that the sale prices of condominiums could hold up better than those of single-family homes, according to Mr. Lefrançois. “With the massive influx of baby boomers in retirement, we could see a lot of demand for house sales and condominium purchases, which could perhaps make the apartment outperform,” he believes.
“However, I don’t think the market will go crazy anytime soon,” adds the real estate broker. “The big unknown in the equation is inflation. It will have to be brought under control. It could be this year — but if we lose control, it could complicate the situation on the real estate market. »
In recent months, the Bank of Canada has already made a strong adjustment to its key rate – taking it from 0.25% at the start of 2022 to 4.25% in December. As a result, rising interest rates resulted in an increase of nearly $1,200 per month for an average mortgage in Greater Montreal, according to data from Royal LePage.