Montreal realtors say this is a good time to buy or sell your home GeoTv news

Interest rates may still be very high, but some Montreal real estate agents say you should think about buying or selling your home now.

“If you're ready to buy, I would definitely say now is a great time,” said Sara Kaplan, a real estate broker at Engel & Völkers. “It was very difficult to deal with buyers in 2020, 2021 (with many offers). It's not fun for buyers. So if you're in the market to buy, now is a great time before things change that way.”

RE/MAX real estate agent Firas Traboulsi adds that there are always pros and cons to buying or selling at any time — whether it's rising interest rates and falling home prices or falling prices and rising prices.

“I've had a few, maybe a half-dozen buyers who weren't planning to buy this year, but they were very concerned that we're going to go back to the trade wars and everything,” he told CTV News.

The interest rate will stabilize

Interest rates rose significantly in 2023, but analysts predict they will begin to decline in 2024.

“Securing the right property for your family at the current interest rate, then consider getting a short-term mortgage,” explains Engel & Völkers real estate broker Tamar Chogonyan. “When it comes time to renew, (you) take advantage of the lower rates expected in the future.”

He cites an example: Instead of taking out a five-year fixed mortgage (with a fixed interest rate) or a five-year variable mortgage (with an interest rate that changes depending on the market), a buyer can choose a two-year mortgage. Update when duration and prices drop.

Trabulsi noted that he is seeing the first signs of people ready to take over the market as soon as interest rates fall.

“Some of them (buyers) are saying, 'We're already making moves: We want to buy now before interest rates go down,'” he told CTV News. “They worry that after the first interest rate correction, too many buyers will jump out of the market and we'll be back in a seller's market.”

The market is smaller

“It's not competitive,” Kaplan explains. “It's not as competitive as it would be in the second half of 2024 when interest rates start to come down, which is what the mortgage brokers we spoke to are predicting.”

Is it worth buying now? People don't compete in situations of high supply, says Kaplan.

“You can find the property you really want and even negotiate a price, which is something you won't be able to do in the future,” Kaplan said. “We've seen this trend in 2020 and 2021, where there are a lot of bid situations and a lot of competition.”

Trabelsi agrees, recalling a property he once sold for $250,000 over the asking price.

“I had buyers who wanted to buy, so they were willing to make crazy offers,” he recalls. “Prices are lower than last year, negotiations have started again. I had several transactions last month where we were able to negotiate $30,000 to $40,000 off the asking price.”

This is good news for buyers, but not for sellers.

“The traders, right now when I meet with them and do the property appraisal, it's $50,000 less than what their neighbors sold for last year, they're not happy,” he said. “They were expecting $800,000, and I told them, 'You're lucky if you get $750,000.'”

Demand is balanced

The word real estate agents are using right now to describe the year 2024 is “balanced” — meaning neither a seller's nor a buyer's market.

“I think we're moving toward a more balanced market,” Trabulsi said. “The market is still very active … If there's a lot of inventory coming to market in the coming months or next year, I think we're going to find ourselves in a buyer's market, which means prices will go up,” he added. “It's over and the negotiations will be more aggressive.”

Agents note that one of the biggest concerns for buyers and sellers is interest rates.

“I think there is concern about interest rates, which has been a theme over the last few years,” Kaplan said. “I think in 2023, a lot of buyers were hesitant to enter the market because they weren't sure if interest rates would continue to rise or not.”

According to him, now the situation seems to have stabilized and the ambiguity has disappeared.

“The same goes for sellers. “They may have been hesitant to list their properties in 2023 because interest rates were much higher and buyers weren't getting what they could afford in 2021 and 2020,” Kaplan said. “Now that interest rates are down, sellers tend to put properties on the market, and that's what we're seeing in the first month of 2024 as well, with more listings coming on the market. Traders can charge whatever price they want.”

Return to the city center

One trend agent says they've seen a shift in people moving to the suburbs and beyond during the COVID-19 pandemic, which is now returning to the city center.

“It's a funny phenomenon that we're seeing, people are coming and moving closer to downtown,” Chogunian said. “Plateau has always been popular. It speaks to many demographics: families, professionals; it has a lot to offer as a neighborhood. The South-West region has always been prosperous.

Trabelsi says the movement is largely due to workers being called to the office.

“You have to drive an hour or an hour and a half to go downtown Montreal, you have to think twice about it,” he said.

Reality check

According to the Quebec Association of Professional Realtors (QPAREB) housing barometer, home sales in 2023 are down 13 per cent across the province compared to 2022.

In Montreal, the decline was 14 percent despite a 28 percent increase in active listings.

However, in January 2024, residential sales in Montreal increased by 18 percent compared to the same period last year, but they are still below the historical average.

“The strong sales performance at the start of the year was largely driven by an encouraging outlook for interest rates,” explains Charles Brant, director of market analysis at QPAREB. “Since the end of 2023, economists agree that the cycle of rising interest rates has passed and the reversal process should begin in 2024.”

The most popular places people shopped in January? There were 541 transactions on the South Coast, a 36 per cent increase on January last year.

It was followed by North Shore (519 sales), Laval (200 sales) and Saint-Jean-sur-Veltier (58 sales) with increases of 19 percent, 18 percent and 14 percent respectively.

Montreal Island (679 sales) and Vaudreuil-Solange (80 sales) recorded increases of eight percent and one percent.

QPAREB notes that active listings have also grown significantly, up 16 percent year-on-year across all property categories.

The average time to sell residential homes was 77 days, compared to 65 days for single-family homes.

In contrast to the 2023 median price, where the median home price for single-family homes fell 2 percent and for condos 1 percent, prices increased in January.

Compared to the corresponding period of last year, it means five percent for residential houses, seven percent for private houses, and seven percent for multi-apartment complexes.