Despite pandemic, Montreal's real estate market had a record year

·2 min read

Earlier this year, many were predicting that housing prices would dip in response to the economic uncertainty created by the pandemic. However, the Montreal market has proved resilient, with housing prices on and off the island steadily increasing.

Georges Gaucher, general manager of Royal Lepage Village, explained that for many, the restrictions imposed by the pandemic "pushed people's boundaries" and incited a desire for more space.

"Imagine a young couple in their 20s, both working from home. They live in a 700 quare-foot condo in Griffintown. If you live alone in 700 square feet, sometimes you go out of your mind. Imagine being two," he said.

He said the year started off strong, with an extremely busy sales season right after Christmas.

"We've never seen so much activity in the first 10 weeks of the year," said Gaucher.

But then confinement put a stop to home visits and realtors were stuck trying to navigate alternative ways of doing business, including virtual visits and the use of drones to gather property video.

But following the height of the first wave, Gaucher said that people were eager to upsize, leaving the city for suburbs where they could continue to work from home or even investing in cottage properties.

"Brokers in the Laurentians had listing for one, two, three years sometimes and suddenly all that inventory was sold." "It was like a rubber band. You stretch and stretch until it snaps."

Gaucher explained that since demand was so high, the limited supply of houses going on the market drove up prices in the Greater Montreal Area.

However, the demand for suburban housing doesn't mean the downtown core is being devalued.

"The downtown core is always the last one to be hit and the first one to recoup, historically," said Gaucher.

Despite price increases, he said Montreal is still more affordable than cities like Toronto and Vancouver where housing has become increasingly unattainable for many.

Looking ahead to 2021

While the Canada Mortgage and Housing Corporation is predicting that prices nationwide will decline in 2021, and some of the country's biggest banks foresee more muted growth, the Royal Lepage forecast is more optimistic, predicting a six per cent increase in prices in 2021.

"We will probably come out of this confinement with some pent-up demand again," Gaucher said.

The company's forecast for 2021 expects the median price of a standard two-storey home in the Montreal area to be $656,200. The median price of a condo is forecast to be $382,600.

The Quebec Professional Association of Real Estate Brokers reported a "record-setting sales" year for 2020, with a projected 110,000 transactions.

Looking ahead, Charles Brant, director of the the association's market analysis department, is cautiously optimistic as well.

"After phenomenal sales in 2020, we will return to a more normal sales level, with market conditions that are still favourable to sellers," he said in a news release.