26 Mar

West Island Living: How will the REM impact West Island property values?

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Posted by: Frederic Pichette

It’s anticipated West Island homes located near a new REM station will increase in value on the real estate market.

A new, high-speed, high-frequency public transportation link isn’t just an investment in transportation, but also a catalyst for development.

Greater Montreal’s planned new electric light-rail transit line, the Réseau express métropolitain (REM), includes seven stations planned for the West Island. Construction is set to begin on the line as soon as next month, with the first trains running by 2021 if all goes according to plan.

With construction comes noise, dust, traffic delays and other disruptions. But when the bulldozers, diggers and cement mixers show up, so do the developers and investors.

In cities like Vancouver, Chicago, and Portland, property values for homes and commercial real estate within a 15-minute walk of a commuter rail station rose starting around two years before completion. This boost in real estate values isn’t just due to the building of the station itself, but also how the neighbourhood develops around it.

Urbanist Paul Lewis, who is a professor at the Université de Montréal, said creating densely developed, diverse and walkable neighbourhoods within that one-kilometre radius of a station is critical to the success of the station, as well as the overall quality of life for people living and working nearby.

“When it’s beautiful and you have shade from trees, interesting buildings, cafes and terraces, it makes a walk more interesting. It also helps if there’s not too much traffic, and it’s also less dangerous,” said Lewis. “These are all the things that people think about when they decide whether to walk to a station or take a car.”

Université Laval economics professor François Des Rosiers said the market premium for properties near a commuter train station varies widely. His studies, as well as others in the field, have found it can vary from a low of around two per cent to over nine per cent. The most impressive increases are typically in areas that had not previously been served by an efficient transit system, he said.

“By and large what we can say is that the addition of a train station has a positive impact on houses that are nearby the stations,” said Des Rosiers.

Although most people depend on cars to get around the West Island, Century 21 realtor Angela Langtry said homes near the existing AMT train line already command a premium, and she expects the same will be true for homes near the REM. She said savvy developers, homebuyers and speculators are already eyeing properties near the proposed stations.

“Already the market in the West Island is on fire,” Langtry said. “We’re short on inventory, and we’re seeing a lot of multiple offers. Factoring in more accessible public transportation is just going to increase this.”

Langtry said she has also been hearing some sellers in the West Island are waiting longer to list their homes, anticipating that they may get more for their property after an REM stations is built nearby.

More information on the seven proposed West Island stations, Dorval (airport), Kirkland (Jean-Yves St.) , Pierrefonds-Roxboro (near Jean-Brillant Ave.), Sunnybrooke-Gouin Blvds., Pointe-Claire (Fairview Ave. and Sources Blvd.) and Ste-Anne-de-Bellevue (north of Highway 40), is on the REM’s website at rem.info/en/montreal-west.

21 Mar

Housing prices in Montreal to keep rising until at least 2019: CMHC

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Posted by: Frederic Pichette

Montreal’s strengthening economy will boost full-time employment rates for people 25 to 44, CMHC says, which will drive demand for property

Housing prices will continue to rise in the Montreal region until at least 2019, according to a forecast released by the Canadian Mortgage and Housing Corporation on Thursday.

“Rising demand, combined with declining supply, will cause market conditions to tighten again and become increasingly favourable to sellers,” the report said. “Consequently, the growth in the average price of homes over the forecast horizon should be definitely higher than the annual average of the last few years, which was about 2.5 per cent.”

The crown corporation said it expects the higher demand for property to be driven by increasing full-time employment rates among people aged 25 to 44, the result Montreal’s strengthening economy. However, increasing mortgage rates could limit this.

Just how much prices will rise will depend on the type of property, CMHC said.

“The single-family home and plex markets should remain very favourable to sellers from now until 2019, which will increase the upward pressure on prices for these types of homes, while the condominium market will be on the fence between a balanced market and a sellers’ market over that period,” the report says.

CMHC expects the average price of a resale home in the region to be between $365,500 and $375,000 this year. It expects that to rise to between $379,500 and $406,000 in 2018 and to between $394,500 and $437,800 in 2019.

With demand increasing, CMHC expects the number of housing starts to rise.

That will be led by condominium and purpose-built rental construction, it said.

On the rental side, it expects to see builders focusing on seniors residences as well as ordinary rental properties, though a portion of those will be aimed at baby boomers, the CMHC said.

“In the condominium segment, construction will increase thanks to a strong demand, which will be supported by employment growth, and also to significantly lower inventories of new and existing condominiums on the market.”

While the CMHC said it expects single family home starts to rise, that will be limited by space.

The growing number of rental housing starts will lead to 4,000 new apartments being “added to the rental housing stock annually until 2019, or about twice as many as in 2016,” CMHC said.

That will push the vacancy rate up to 4.4 per cent, it said.

While immigration may reduce the vacancy rate, the rising number of rental condos is expected to push it up.

13 Mar

Number of homes sold for more than $1 million rises 20% in Montreal

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Posted by: Frederic Pichette

The number of properties sold in Montreal for more than $1 million rose 20 per cent from 2016 to 2017, according to a new report published by Sotheby’s International Realty Canada.

The number of properties sold in Montreal for more than $1 million rose 20 per cent in 2017, according to a new report published by Sotheby’s International Realty Canada, based on data from real-estate boards.

A total of 734 properties sold for more than $1 million, according to the report, up from 613 the year before, with growth limited by the available supply.

It’s the second year in a row that the “top-tier” market has seen similar growth: the number of properties sold for more than $1 million rose by 23 per cent in 2016 compared with 2015.

While Montreal has always had a well-developed real-estate market, it has been held back by fears of political instability, said Brad Henderson, the president and CEO of Sotheby’s International Realty Canada.

That perception is changing.

“Over the last number of years, the political situation has been very predictable and very stable, and I think that’s gained a lot of confidence from businesses and consumers and a willingness to look at Montreal on a more positive note,” he said. “The hyper growth of real-estate prices in Vancouver and Toronto have made Montreal a comparison bargain in terms of real-estate values, and that’s not just for investors — it’s also for developers and homebuyers.”

 At the highest end, the number of homes that sold for more than $4 million rose from nine in 2016 to 12 in 2017, a 33-per-cent increase, the report found.

The number of condos selling for more than $1 million also rose, to 122 from 82, a 49-per-cent increase. Of those, two sold for more than $4 million.

“The demand for residential real estate in Montreal is from people who live and work in Montreal more than it is foreign investment. It is the health of the Montreal economy. It is the stability of the Montreal job market that is contributing to the demand for growth,” Henderson said.

In Westmount, the average selling price of a single-family home in November was $3,230,286. The Town of Mount-Royal and Outremont also had average selling prices of more than $1 million in November.

“The first and foremost rule of real estate is that it’s location, location, location, and so it’s not surprising that places in Westmount, Mount-Royal or Outremont are going to be higher demand and, as a consequence, are going to have buyers who are expecting higher quality, and that means higher ceilings, potentially more glass, potentially more smart, intelligent systems inside the home and a lot more amenities available either in the building or in the local area,” Henderson said.

6 Mar

Fourth-quarter real-estate sales up 9% in Montreal

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Posted by: Frederic Pichette

The residential real estate market in the Montreal region grew by nine per cent between the fourth quarter of 2016 and the fourth quarter of 2017, according to the Quebec Federation of Real Estate Boards.

The number of residential real-estate sales in the Montreal region during the fourth quarter was up nine per cent when compared with the equivalent period in 2016, according to the Quebec Federation of Real Estate Boards.

But it wasn’t the fastest-growing market in the province.

Trois-Rivières saw sales rise by 20 per cent during the same period.

In both markets, median prices rose by five per cent.

The number of active listings in the Montreal region was down 12 per cent from the fourth quarter of 2016.

Across the province, fourth-quarter sales rose by eight per cent, while median prices for single-family homes rose by an average of three per cent.

In the Montreal region, the island of Montreal saw the biggest increase in sales. Fourth-quarter sales were up 12 per cent from the equivalent period the year before. It was followed by the South Shore, where sales were up 11 per cent.

The island of Montreal also saw the biggest price increases in the region. On average, median prices for single-family houses were nine per cent higher in the fourth quarter of 2017 than in the equivalent period in 2016, reaching $467,500.

The median price of a condo was up by eight per cent on Montreal Island, to $312,000, while prices rose by seven per cent in Laval, to $230,750. In both Vaudreuil-Soulanges and St-Jean-sur-Richelieu, condo prices remained flat during the period.

Among neighbourhoods, Côte-des-Neiges/Côte St-Luc, which are measured together by the QFREB, saw the biggest increase in sales between the fourth quarter of 2016 and the fourth quarter of 2017: 38 per cent.

Notre-Dame-de-Grâce/Montreal-West saw the largest percentage increase in median prices during that period, up 23 per cent to $740,000.

Ahuntsic-Cartierville saw the largest percentage increase in condo prices, up 16 per cent during that period to $270,000.

Across the Montreal region, there were 44,448 property sales during 2017, the second highest on record and an increase of eight per cent from the year before. Condominium sales were up 17 per cent from 2016 to 2017. Across the region, the median price of a single-family home was $310,000, while the median price of a condo was $247,000.

On a year-over-year basis, the number of active listings was down 13 per cent. Demand for single family homes on Montreal Island continues to outstrip supply, the QFREB said.