Heat wave or not, the real estate fever that gripped the market for chalets and second homes two years ago is currently experiencing a severe cold snap.
“For a few weeks now, weekend visits with the opening of several purchase offers on Tuesday have no longer been part of our reality,” admits Michel Naud, agent at the Engel & Völkers agency in Mont-Tremblant.
“Buyers are more composed, visits are less hectic and there are fewer overbids. Interest remains, but there is no longer room for exaggeration, he says. Sellers may need to lower their expectations. »
return of the pendulum
Laurentians, Lanaudière and the eastern townships, which have always been hot spots for vacationers, are currently experiencing the same pendulum swing as the rest of the province, says Charles Brant, director of the market analysis service of the Professional Association of Quebec Real Estate Agents.
The gradual hike in the Bank of Canada’s key interest rate since the spring, combined with the resumption of international travel and public concerns about inflation, have meant that the momentum of many investors has been drastically slowed down.
“After two years of the pandemic, things seem to be slowly returning to normal,” explains Mr. Brant. The market remains in favor of sellers, but there is a sharp drop in transactions and an increase in listings. »
31% decrease in Saint-Sauveur
This is particularly true for second home markets, which historically have been the first to suffer in times of economic uncertainty. In Saint-Sauveur, for example, the number of transactions in June fell by 31% compared to the same period last year.
In this changing environment, some retirees, consisting of Georges Melançon and Céline Bernier, decided this spring to part ways with their Austin, Eastern Townships residence. After living there for 15 years, the couple is ready to move on.
“Basically, we want to reduce our living space. With the arrival of our grandchildren, we want to spend less time maintaining a home and property that has outgrown our needs. »
The catch is that their project comes at a time when the market is showing signs of running out of steam. You are not alone in your case. Karine Bonin, real estate agent for Re/Max in Magog, confirms the slowdown.
The return of negotiations?
Everywhere the registrations are increasing, the number of transactions is decreasing…
And even if the prices remain the same for the time being, she is observing a rethinking among buyers.
“Recourse to one-upmanship is no longer automatic. Even that, more and more are bargaining and some no longer hesitate to make offers below the advertised price [5 à 10 %]something we haven’t seen in years,” she says.
Put in perspective…
For some sellers, this new reality can be harsh. Does she worry Mr. Melançon? Not really. On the contrary, he claims to be confident that the price set for his home reflects the current market and states that his sale is not in an emergency.
“If not this year, then next year,” he says, before adding the following relativistic reflection: “Don’t forget that if you sell cheaper today, you should in principle be able to buy it back cheaper. »
The tide is accelerating in the metropolis and the state capital
The province’s real estate markets, like those in Greater Montreal and Quebec, continue to show signs of an accelerated slowdown.
The latest data from the Association professionnelle des courtiers immobiliers du Québec (APCIQ) shows a 15% decrease in the number of transactions in July compared to the same month in 2021.
If prices continue to rise in Quebec — by about 12% on average — the number of homes for sale will be 13% higher than at the same point last year. A cocktail that could herald a possible slowdown or even stagnation in the growth of property prices here.
“In continuity with the June records, the change in market dynamics is clearly confirmed,” said Charles Brant, director of market analysis at APCIQ. The magnitude of interest rate hikes in just 4 months accelerated the market slowdown. »
Free fall in Montreal and Laval
Greater Montreal saw an 18% year-over-year decline in transactions in July and a 28% increase in listings over the same period. However, prices continue to rise: up 10% in July versus 17% year-to-date.
The cities of Montreal and Laval are showing the clearest signs of a slowdown in the region, with sales volumes down 29% compared to July 2021. Active listings are up 18% in Montreal (including 54% for single-family homes) and 13% in Montreal risen Laval.
Sign also in Quebec
The metropolitan region of Québec looks different from the rest of Québec. It is one of the few markets in the country to see an increase in sales compared to last year.
Its sales are up 1% and its listings are 15% lower than last year. However, explains the APCIQ, this activity is partly explained by the inclusion of an increasing inventory of properties for this period of the year.
“While this August and September spike needs to be confirmed to be a trend, it does portend a slowdown in the market and much weaker price growth or stabilization in the coming months,” said Mr. Brant.