The slowdown in real estate market activity is less marked in the Québec region.
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In the second quarter, sales fell by 4% in the CMA of Quebec, while the decline was 14% across Quebec, compared to the same period in 2021.
Despite everything, the region maintained a strong level of transactional activity with 2,590 transactions, which remains much higher than the historical average since 2014, which stands at just under 2,200 transactions.
“The Quebec City market is a little behind the cycle compared to other markets. We see elsewhere that the registrations in force are going up, while in Quebec they continue to compress. This means that there is still strong activity and that there is also a lack of properties on the market,” said Charles Brant, director of the market analysis department at the Professional Association of Real Estate Brokers of Quebec (APCIQ).
One of the particularities of the Quebec region is the price of properties, which remains lower. In the single-family home market, for example, the median price is $349,000 (11%) while it is 448,694% (20%) elsewhere in the province.
Household enthusiasm
“The prices are causing a certain enthusiasm on the part of households. They are still very attractive in terms of their purchasing power and we know very well that in Quebec City, the purchasing power of households is quite comparable to that of households in the Montreal region. This is what keeps the market going,” adds Mr. Brant.
“The economic base is quite centered on services and in particular public services. So, these are salaries of a certain level that offer a certain stability. This also plays into this phenomenon. What I would also say is that in Quebec, there has been in relative terms more new construction than elsewhere in the province. »
According to Mr. Brant, the market in the Quebec City CMA has been exposed to less overbidding than other markets further south, such as Montreal.
“Probably there are fewer proprietary investors active in the market, less speculation. This is also why the price evolves in a more balanced way in Quebec […], whereas elsewhere we can see excesses of 20%, 25% and 30%. »
“It’s very good for the Quebec market because we can’t speak of a risk of overvaluation on this market, but just of a catch-up and a healthy progression of prices in harmony with the economic fundamentals, in particular the purchasing power of households,” explains Mr. Brant.
More serene
The recent increase in the Bank of Canada’s key rate comes at a time when property prices are at an all-time high.
“We think that in Quebec, where overheating has been brought under control, where there have been few deviations and where prices are linked to economic fundamentals, that the risks of overvaluation are less significant, and therefore, that the market could go through this period of rate hikes more calmly than in other markets, with perhaps small price drops, but really just small corrections, in our opinion,” he concludes.
