Montreal’s real estate market remained hot in August, breaking records for sales as it did in July.
The sales record matches those in cities across the country.
Some experts say, however, that the market is simply playing catchup from the spring when sales halted and real estate purchases ground to a halt.
In August 2020, 4,878 residential sales were concluded, which is a 39 per cent increase from 2019, according to a report from the Quebec Professional Association of Real Estate Brokers (QPAREB).
It was, the report says, the highest number of transactions ever recorded in August since the association began compiling market data in 2000.
“The loss of transactions due to the confinement period in early spring have almost all been recovered thanks to phenomenal sales activity in July and August, which are usually among the quietest months of the year,” said association president and CEO Julie Saucier. “The pandemic is clearly having an unexpected impact on buyer behaviour as there is a renewed interest in buying properties, particularly single-family homes.”
Vaudreuil-Soulanges (62), the North Shore (51) and Laval (48) led the pack in respective percentage increases with the Island of Montreal going up by 29 per cent.
Single-family home sales (2,601) had the largest increase in sales (47 per cent).
Francis Cortellino of the Canadian Mortgage and Housing Corporation said, however, that the numbers from 2020 as a whole show a three per cent decrease from 2019, which is not a true comparison as the COVID-19 pandemic threw the market completely off course.
From January to March, Crotellino said, sales were up 12 per cent; April and May, the markets halted; and then they sped into hyperdrive from June to August as people who had planned to buy in the spring followed through with their purchases.
“A share of those sales were probably people who wanted to buy in April and May, but couldn’t because the market was shut down,” said Cortellino. “There’s some catching up.”
Even with the record-breaking sales numbers since the market opened, from April to August, Cortellino said, sales are down 13 per cent.
One thing is clear, Montreal remains a sellers’ market as unit scarcity remains.
There was 12,953 active listings in the Montreal metropolitan area in 2020, which is 21 per cent less than the number in 2019.
“It was low and it’s still pretty low,” said Cortellino. “It was a sellers’ market and we’re still in a sellers’ market right now.”
Single-family home prices rose 24 per cent in August and the median price is now $427,500. Singe-family homes above $1 million more than doubled in August, which increased the median price.
The median price for condos is $312,000, up 12 per cent.
“Against all expectations, this enthusiasm is supported by a notable increase in the savings rate of many buyers in recent months,” said Saucier. “The situation is particularly present in the suburbs, where cases of overbidding are increasing and market conditions are still extremely favourable to sellers.”
The unemployment rate in Montreal doubled from February to September, and it remains to be seen how that will affect the real estate market, according to Cortellino.
“In the fall we’ll have to see how the market adjusts to this new reality, but for now there’s a lot of catching up,” he said.
Even if the markets cool, Cortellino added, it is unlikely that Montreal will swing from sellers’ to buyers’ market any time soon.
“The real estate market is so tight that it would be quite unlikely that there is a major shift where we go from a sellers’ market to a big buyers’ market where prices go down a lot or it’s really hard to sell a unit,” he said.
Cortellino said other markets in Canada were pretty close to a buyers’ market, so any slow down could easily tip the balance.
In Montreal, it would be a much longer road.
WILL RENT RATES GO DOWN?
High sale prices may have an effect on the island’s rental market.
Cortellino said census data since 2016 has shown that more younger people are renting, and this trend will likely continue as those under 35 have been most affected by COVID-19 job loss.
“With those price increases we’ve seen in Montreal right now, it’s probably more difficult for young people to accept home ownership,” said Cortellino. “A lot of the job losses are among young people as well, so that’s going to affect home ownership.”
According to a CMHC report, approximately, 10,000 new rental units will appear on the market in 2020, which is a record.
“This growth in supply will ease pressure on the rental market,” the report reads. “Demand for rental housing will be supported by a slowdown in homeownership, but overall, this demand will continue to be heavily dependent on net migration.”
Migration to Montreal has broken records in recent years, and fueled the low vacancy rate for rental property, Cortellino said.
The pandemic coupled with CAQ provincial government policy limiting immigration has cut that trend in 2020.
This will likely negatively affect rental demand, Cortellino said.
“If migration decreases a lot, it’s likely that the vacancy rate will increase on the market because it’s the main driver of the rental demand,” he said.
In addition, there has been a good deal of rental purpose construction in the past number of years meaning the supply is increasing.
“Once again we’re going after record after record with construction of rental apartments, so there are a lot of spikes coming onto the market, and at the same time the main driver of migration is decreasing,” said Cortellino. “Probably we’re going to have an increase in the vacancy rate.”
Source:- CTV News Montreal
Vancouver real estate: early September numbers show steep drop in sales from August highs – The Georgia Straight
Home sales in the city of Vancouver are dropping big time.
This is based on tracking by real-estate site fisherly.com as of late morning Friday (September 25).
Compared to record highs in August, early numbers for September show a steep decline in transactions.
In August, a total of 490 condo units sold in Vancouver.
As of this posting September 25, fisherly.com recorded 202 condo sales so far this month.
Last month, 212 detached homes changed owners.
September sales so far show 114 freestanding houses sold in the city.
As for townhouses, 99 sold in August.
As of September 25, only 49 townhouses have been purchased.
Vancouver home sales peaked in August, following a steady recovery that started in May.
Transactions crashed in April during the height of the COVID-19 lockdowns.
RBC Economics previously issued a report noting that pent-up demand for homes drove real estate sales in the country this summer.
However, according to the bank’s report, this demand is largely spent, and that the market’s momentum is expected to decelerate in the fall.
The Canadian Real Estate Association has forecast that after its highs and lows, 2020 may likely end up as a “fairly middling year overall”.
It remains to be seen whether the Vancouver market will stage a late September rally to boost numbers.
Real Estate Roundup 9.25.20 – Real Estate Daily Beat
Real Estate Roundup
- SL Green and Jacob Chetrit have resolved their dispute over the broken contract for the Daily News Building. (TRD)
- Global pricing and demand for office space will take almost five years to recover from the damage wrought by the pandemic, according to a report by Cushman. Vacancies worldwide are expected to peak at 15.6% in 2022, with about 95.8 million SF of space emptying over the next two years. That’s more than during the 2008 financial crisis, when tenants abandoned 85 million square feet of offices. (Bloomberg)
- Barclays is set to ramp up staff numbers in New York next month, asking a fresh contingent of employees to be “primarily office-based”, as the UK lender prepares to U-turn on its plans to bring more people to its Canary Wharf headquarters. (FinancialNews)
- Mizuho Financial Group plans to trim office space in New York and London in anticipation that some staff will keep working from home even when the coronavirus pandemic is over. (Bloomberg)
- When Everybody’s Working At Home And The Magic Is Gone. (NPR)
- Brookfield Properties and Namdar Realty are separately requesting they be allowed to give up their J.C. Penney-anchored malls to special servicers to avoid loan foreclosure. The action is known as a “deed-in-lieu.” Mall owners most likely to default are those with CMBS debt. Such loans are difficult to restructure because of covenants bondholders have with servicers. (TRD)
- Spring Education Group has signed a 20-year lease for 34,500 SF at Albanese Development’s 556 West 22nd Street. The group’s BASIS Independent Schools will occupy the entire three-story building to serve students in grades 6 through 12. (TRD)
- Although Zillow has long denied it wants to become a real estate brokerage, the changes to its iBuying program mean it is doing just that. Previously, Zillow worked with local real estate agents to complete both ends of the transaction, but now it will instead use its own employees who are licensed real estate agents. (MotleyFool)
- Co-living firm Common has raised $50 million in new venture capital this month. Earlier this summer, competitor Juno Residential launched with $11 million in venture funding. (WSJ)
- New York Community Bank and Signature were among the top five most-active lenders in New York in the first half of the year, and almost all of their portfolios are tied to the area. With retail and apartment vacancies rising and rents falling, and with the prospect of employers cutting their office space looming, the question is whether the hundreds of millions of dollars the banks have set aside for commercial-property loan losses will be enough. (Bloomberg)
- Blackstone’s China Real Estate Head Tim Wang leaves after 10 years. (Bloomberg)
- Blackstone Group closed on the largest real-estate debt fund ever. The private equity firm began raising money for the fund in the spring of 2019, and ultimately took in $8 billion. Fundraising got a boost after Covid-19, partly because interest rates fell, increasing the appeal of relatively high-yielding real estate debt. (WSJ)
National Real Estate Deal Roundup 9.25.20 – Real Estate Daily Beat
National Acquisitions Roundup
- Amazon has acquired 550 Army Navy Drive in Pentagon City, Virginia from the Blackstone Group for $148.5 million. The tech giant plans to demolish the existing Marriott hotel and utilize the 1.5 acres of land as part of its second headquarters. With the deal, Amazon now owns the entire 11.6-acre PenPlace. The site was always part of the company’s HQ2 plans, but the hotel remained the last holdout, and it appeared the company would just build around it. (CO)
- A consortium of South Korea’s Hana Alternative Asset Management has signed a contract to acquire a 38-story office tower in downtown Seattle for around $686 million. Skanska USA’s newly-constructed Qualtrics Tower spans 701,000 SF. Tenants include Qualtrics, Indeed, Dropbox, and co-working firm Spaces. (KI)
- Invictus Real Estate Partners has purchased the remaining 90 percent stake in The Waypointe at 515 West Avenue in Norwalk, Connecticut from Carmel Partners. The two-building complex, which includes 56,000 SF of ground floor retail and restaurant space, opened in 2015. Its apartments are currently 93 percent occupied, while the retail space is 74 percent leased. The deal valued the asset at $157 million. (TRD)
- As part of its ongoing industrial real estate expansion, PGIM Real Estate has acquired a 40 percent interest in a 5.4 million-square-foot, 12-complex industrial portfolio valued at $700.5 million. PGIM acquired the stake in the portfolio through a recapitalization of the interest in a JV with partner IAC Properties and a subsidiary of Perlmutter Investment Company. At that valuation, the deal works out to a 4.7 percent cap rate. The portfolio includes 30 industrial properties spread throughout the 12 complexes, which altogether are 97 percent leased. (CO)
- July Residential and Firm Capital Apartment REIT have acquired North Pointe at 5735 29th Avenue in Hyattsville, Maryland from FCP for $37.5 million. The 19-building apartment community contains 234 units. (CO)
National Leasing Roundup
- Netflix has signed a 171,000-square-foot office lease in Burbank near major competitors like Warner Brothers and Walt Disney. Netflix’s new space is at 2300 West Empire Avenue near the 5 Freeway in Los Angeles County. Earlier this month, CEO Reed Hastings told WSJ that he expects employees back in the office once a coronavirus vaccine is available. (CO)
- Logistics and storage firm Mega Lion has signed a 132,423-square-foot lease at 13021 Leffingwell Road in the Mid-Cities submarket of Los Angeles County. Golden Springs Development owns the property. Asking rent on the five year lease was reportedly $0.90 per SF, triple net. (CO)
Possible COVID-19 exposure at 11 Prince Albert, Rosetown businesses: SHA – Global News
A dazzling full 'harvest moon' is set to illuminate Vancouver skies next week – Vancouver Is Awesome
Alberta reports more than 100 COVID-19 cases for 16th straight day – CTV Edmonton
Silver investment demand jumped 12% in 2019
Iran anticipates renewed protests amid social media shutdown
Richmond BBQ spot speaks out about coronavirus rumours Vancouver Is Awesome
- Economy22 hours ago
Pandemic's impact to influence economy, social order for long time, forum told – Assiniboia Times
- Media22 hours ago
Surrey-born Trybe social media app's award system connects with Nickelback singer – Cloverdale Reporter
- Art7 hours ago
Novelist Ali Smith Finds Art for All Seasons – The Wall Street Journal
- Economy17 hours ago
Why stock markets are up 44% amid the worst economic contraction in history – CBC.ca
- News24 hours ago
Coronavirus: Canada adds 1,329 cases, 5 deaths Thursday – Global News
- Sports22 hours ago
Los Angeles Lakers vs. Denver Nuggets Game 4: Live score, updates, news, stats and highlights – NBA CA
- Media17 hours ago
Social & sensible: Due to the lockdown, time spent on social media grew exponentially for everyone. So is a break the need of the hour? – The Tribune India
- Business24 hours ago
Concerns over safety, confusion over rollout of Ontario's pharmacy testing plan – Ottawa Citizen