After years of Metro Vancouver leading the country in terms of soaring detached home sales, the recent softening of that market has paved the way for a boom in Montréal, according to a report published March 21.
The Québec cultural metropolis is seeing huge growth in terms of “top-tier” real estate – that is, home sales above $1 million, reported Sotheby’s International Realty Canada in its 2018 Top-Tier Spring Market Outlook. The luxury real estate brokerage found that sales of $1m-plus units in the city rose 20 per cent year over year and is predicted to see a record-setting 2018.
At the same time, the Vancouver region’s detached home market is seeing a slowdown, caused in large part by the B.C. government’s recent measures aimed at improving housing affordability, according to the report. Sales of detached homes of $1 million or above – which is the vast majority in the region – in the first two months of 2018 fell 39 per cent year over year, the report stated.
However, the brokerage does not expect the new policies to affect Metro Vancouver’s condo market in the same way – even those above $1 million.
The report authors wrote, “Uncertainty introduced by the British Columbia government’s new demand-side taxes and policies are expected to diminish activity in the detached home segment, while spring [$1 million-plus] condominium activity is expected to maintain the momentum experienced in the first two months of 2018, which saw sales volume spike 51 per cent year-over-year.”
The 51 per cent jump in $1 million-plus condo sales is likely as much to do with rising prices as an active market. According to the Real Estate Board of Greater Vancouver, benchmark condo prices in February 2018 were 27.2 per cent higher than one year previously. This suggests that many condo sales, which one year ago would have been less than $1 million, were this year pushed up into that $1 million-plus bracket.
Brad Henderson, president and CEO of Sotheby’s International Realty Canada, added, “In Vancouver, the new housing measures introduced in February cast confusion and uncertainty into the consumer mindset. While demographic trends and housing needs will support the top-tier condominium market, disruption in the overall real estate market is inevitable.”