According to the DuProprio Group’s latest report for the third quarter of 2023, recent interest rate increases are beginning to have a more noticeable impact on the Quebec real estate market.
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According to data released on Wednesday, the real estate market appears to be returning to some balance after the strong enthusiasm during the pandemic, but the advantage remains in favor of sellers.
The increase in interest rates has not yet had a “major impact on the average sales price in the province.” The average price in Q3 was $395,000, up 2% year over year.
At the same time, buyers have a larger selection available than last year. Although the stock of real estate is larger, it is not increasing “substantially”.
The lack of property choice is partly due to a decline in the number of owners looking to sell their property.
“Only the Gatineau and Sherbrooke markets offered more options to aspiring homeowners,” DuProprio reports.
On the other hand, buyer interest is lower due to higher barriers to obtaining a mortgage, including high interest rates.
While the situation is still interesting for sellers, change continues to take place.
DuProprio is also noticing increasingly clear differences between individual regions.
Here is the full report:
Gatineau, market slowdown
The residential property market in the region has been fairly stable over the past 12 months, to the benefit of sellers. Last quarter, market strength in the Gatineau metro area appeared to have weakened at the same pace as the rest of the province. The industry’s sales to new listings ratio is at its lowest level since January 2022. However, the various indicators suggest that the Gatineau region continues to be a buoyant market.
Selling price
The median sales price index for single-family homes remained stable in the Gatineau metropolitan area in Q3 compared to Q2, despite a decline of just over 2% compared to the same period last year.
To access the condo market, buyers had to pay a similar amount to last year, $315,000. This represents an increase of just 1% in one year.
Sales deadlines
The slow market is currently not impacting sales times in the Gatineau Census Metropolitan Area. These are rather stable and low and are 37 days for single-family homes. This is a phenomenon we sometimes see during a market downturn: the delay is only recorded for properties that have been sold, but not for those that are still for sale. With many properties still available for purchase, it is still unclear how many days it will take for them to sell in this changing market.
Property inventory
While the supply of new properties is relatively consistent year-on-year, the almost 9% decline in the number of properties sold over the period resulted in inventory increasing to an average of 1,553 properties for sale over the quarter6. This represents a significant increase of almost 9% compared to the last quarter.
Despite the relatively significant increase in current inventory, the volume of properties available on the market is still low and does not meet demand. For this reason, the Gatineau market remains beneficial for sellers.
Montreal is still difficult to access
Statistics for the most recent quarter in the Montreal metropolitan area are similar to those of the Gatineau CMA. After renewed momentum in the second quarter, the Greater Montreal area is in a favorable position for sellers compared to last year. The fact that new registrations are rather rare contributes significantly to the fact that the advantage remains on the owners’ side.
Selling price
The sales price of single-family homes in the Montreal CMA has continued to rise since the beginning of the year and has even made up the difference compared to the same quarter of 2022.
The same goes for condos in Montreal. The latter recorded an increase in its average price to $405,000 in the last quarter, an increase of 1% compared to the previous year.
The multiplex real estate market (2 to 5 units) in the Montreal CMA also shares similarities with the condominium and single-family home market. The median price recorded an increase compared to Q2 2023. However, it is relatively similar to last year for the same period, i.e. $712,250, a decrease of less than 1%.
Sales deadlines
In the Greater Montreal area, the slowdown in the real estate market in the third quarter of the year had no impact on property sales times. They remain rather stable, namely 49 days for single-family homes.
Property inventory
The combination of the decrease in the number of new offers on the market (-7%) and the increase in the number of sales transactions carried out (+4%) will have led to a decrease in the inventory of properties available to buyers Greater Montreal area. In fact, there were an average of 17,430 properties for sale during the quarter, representing a 4% decrease in inventory compared to Q2. Result: Inventory in the Montreal CMA is well below the provincial average, and buyers have even more limited choices when purchasing their new home.
Quebec, to the advantage of the sellers
The Quebec Census Metropolitan Region continued to release interesting statistics for property owners in the third quarter of the year. After an exceptional second quarter, the last few months have shown a buoyant real estate market that has been stable for a year and is strongly benefiting sellers.
Selling price
With an average sales price that has historically been lower than the Montreal and Gatineau markets, the Quebec CMA continues to catch up. For this reason, buyers have had to expect higher costs to purchase a property in the Capitale-Nationale city region since July. This trend, which has been observed for several quarters, even increased towards the end of the last period: the average price for single-family homes was over $368,000 in September!
We’re seeing the same trend in condos, as the average price reached $262,000 in the third quarter of the year, up just over 2% year-over-year.
Sales deadlines
The sales lead time in the region was maintained compared to the previous quarter. It takes an average of 56 days to sell a single-family property in the Quebec census metropolitan region.
Although the trend in the Quebec CMA is less pronounced than the previous quarter, more than a third of owners who listed their property for sale on DuProprio.com said they completed their transaction within 30 days. This is above the national average!
Property inventory
The number of new listings in the Quebec market fell by 5% in Q3 2023. The number of properties sold during this period increased by more than 12% compared to last year. These two trends combined have resulted in the inventory of properties for sale in the Quebec CMA declining 6% quarter-on-quarter, now standing at a meager 3,552 properties. These factors help provide sellers with an advantageous competitive environment in the industry.
Saguenay, affordable but on the rise
Saguenay is an excellent market for property owners looking to sell their properties. Although the industry market is no longer as vibrant as it was in 2022, it shows better statistics than at the beginning of the year.
Selling price
In this seller-friendly market, the average price of single-family homes rose between July and September 2023, setting a record in the region.
Sales deadlines
Properties in the Saguenay CMA found buyers fairly quickly during the quarter. It took an average of 45 days to sell a single-family home. In fact, more than 40% of owners who listed their property on DuProprio.com reported completing a successful sales transaction in less than 30 days!
Property inventory
Despite a 4.6% increase in the number of new properties listed for sale in the Saguenay CMA compared to the same period last year32, inventory did not record a similar increase. The number of sales transactions carried out in the last two quarters will therefore have led to a decrease in the number of properties for sale in the sector. Inventory was just 474, a decline of more than 5% from the previous period. This reduced inventory continued to offer sellers more favorable conditions than buyers.
Sherbrooke, a transition on the horizon?
Even in the Sherbrooke metropolitan area, despite a fairly significant decline in strength in the third quarter of the year, several indicators continue to suggest that the market is favorable for sellers. Although the sampling period is short, the statistics tend to suggest that the Sherbrooke CMA is in greater flux than other markets in the province.
Selling price
Despite the weakening market strength, the average price of single-family homes continued to rise significantly, even reaching an all-time quarterly high of $380,000. That’s an increase of almost 5% compared to the same period last year!
Note that nearly one in four homeowners who listed their property for sale on DuProprio.com in the industry reported selling in a bidding war in Q3!
Sales deadlines
The slight market lull in the Sherbrooke CMA was not reflected in selling times. They remained stable in the third quarter and were 48 days for single-family homes.
Property inventory
In a sign that the region’s market appears to be changing, the inventory of properties available to buyers increased 11% in the third quarter compared to the previous period, well above the provincial average. Two factors explain this phenomenon: the number of sales transactions fell by 9% during the reporting period, and the number of new properties offered for sale, in turn, increased by 3% compared to the previous year.
Although the supply of real estate increased relative to demand in the Sherbrooke CMA, the real estate market remained in favor of sellers.
Trois-Rivières, return to a very active market
The Trois-Rivières market behaved differently than other regions in the third quarter. While the provincial market showed strong strength in the second quarter, the market in the census metropolitan area of Trois-Rivières had slowed.
The third trimester heralds the return to a more active state. Several other indicators show that the sector market is still on the side of sellers.
Selling price
Known for being relatively affordable, Trois-Rivières is gradually catching up with the rest of the province. The real estate market closed Q3 with an average sales price of $313,899 for single-family homes, an increase of nearly 4% compared to the same period in 2022.
Owners in the area who have utilized DuProprio’s services have benefited from the strength of this market. More than a third of them said they accepted an offer higher than the last listed price on their property! This bidding war in the Trois-Rivières CMA was on the same scale as in 2022. This is a sign that the market in this sector remains extremely buoyant.
Sales deadlines
Given the market situation, lead times in the third quarter of 2023 remained very short for the region. For single-family homes it was 38 days. This is also the only census metropolitan area where delays were as small as last year. Nearly half of the owners who listed their property for sale on DuProprio.com said they sold it within a month of selling.
Property inventory
Not surprisingly, the number of properties offered to buyers in this sector continued to decline in the third quarter, giving the CMA Trois-Rivières the status of a very favorable market for sellers. A 5% decline in new listings and a status quo in completed sales transactions compared to the previous year helped reduce inventory by more than 15% compared to the previous quarter.
Aspiring owners in the Trois-Rivières sector were therefore faced with even fewer options in the last quarter, allowing sellers to retain the upper hand in the market.