Real estate statistics for the 3rd quarter of 2023: The rate hike is cooling things off
Published on November 3, 2023
Signs continue to point toward balance returning to the real estate market in the near future; but a drop in the provincial property inventory and a rise in the median price still give a positive picture of the sales market.
To see past statistics, read the Real Estate Minute for the 2nd quarter of 2023.
The months of July to September clearly show that, after a very active 2nd quarter, the market has toned down, returning to a similar energy level as was seen early on in the year.
Here are the statistics for the 3rd quarter of 2023 and our forecast of what’s coming next: The Real Estate Minute.
Contents:
- Market strength decreasing
- Market slows in Gatineau
- Montreal still difficult to access
- Sellers have the advantage in Quebec City
- Saguenay: Affordable but on the rise
- Sherbrooke: Transition ahead?
- Return to a very active market in Trois-Rivières
- Trend analysis and look forward
Market strength decreasing
In the last several quarters we have seen signs that the market is losing steam, without it actually being in a slowdown. However, the 2nd quarter was very busy province wide.
But buyers’ enthusiasm cooled at the dawn of the 3rd quarter in response to increases in the key interest rate in June and July. While the interest rate hikes did have an effect, it was not felt evenly across the province. Here is a picture of Quebec’s regions and cities to explain the new reality of the real estate market.
Market slows in Gatineau
The residential market in the city had been a fairly stable seller’s market over the past 12 months. But in the latest quarter, the market’s energy seemed to wane in the Gatineau census metropolitan area (CMA), at the same pace as in the rest of the province. The ratio of sales relative to new listings is at its lowest since January 2022 for that area.1 But despite that, the indicators show that the Outaouais region continues to advantage sellers.
According to the Methodologies for the Housing Market Assessment of the CMHC, a ratio of over 55% characterizes a seller’s market, and one over 70% is an overheated market.
Selling price
The median selling price for single-family homes remained steady in the Gatineau metropolitan region in the 3rd quarter, relative to the 2nd quarter,2 despite the fact that it was a decrease of slightly over 2% compared to the same quarter last year.3
As for condos, buyers paid a similar amount as last year, that is, $315,000.4 This is a barely 1% increase in one year.
Selling times
The lull in the market has not yet affected selling times in the Gatineau CMA. These remained fairly stable, at 37 days for single-family homes.5 This is sometimes seen in market slowdowns, as selling times are only recorded for properties that have sold, not those still on the market. Since there are still many properties available for purchase, it is not known how many days it will take them to sell in this transition market.
Property inventory
While there is a relatively constant number of new properties on offer, as compared to last year, the almost 9% drop in the number of properties sold during the period pushed inventory up to an average6 of 1,553 properties for sale during the quarter. This is a considerable hike, almost 9% compared to the previous quarter.7
Despite the relatively steep increase in the current inventory, the volume of properties available on the market is still low and is not meeting the demand. For that reason, the Gatineau market continues to favour sellers.
Montreal still difficult to access
The last quarter’s statistics for the Montreal CMA are similar to those of Gatineau’s. After experiencing renewed vigour in the 2nd quarter, Greater Montreal is still in a favourable position for sales compared to last year. The fact that new listings are relatively scarce is a major factor in keeping the advantage on the homeowners’ side.
Selling price
The selling price of single-family homes in the Montréal CMA continued the growth trajectory that began at the start of the year, and even made up the gap with the 3rd quarter of 2022.8
The same situation held for Montréal condos and other co-ownerships. These experienced an increase in the median price over the latest quarter, reaching $405,0009—an increase of 1% over last year.10
The multiplex (2 to 5 units) market in the Montréal CMA has also been similar to those of condos and single-family homes. The median price increased from the 2nd quarter of 2023, but it is relatively similar to the price for the 3rd quarter of 2022, at $712,25011, which is a drop of less than 1%.12
Selling times
In the Montréal metropolitan region, the slowing of the real estate market did not impact selling times in the 3rd quarter.13 These have remained relatively stable, at 49 days for single-family homes.14
Property inventory
Combined, the lower number of new listings on the market (-7%)15 and the higher number of sales transactions concluded (+4%)16 have reduced the inventory of properties available for purchase in Greater Montréal. There was in fact an average of 17,430 properties for sale during the quarter, which is 4% lower than the inventory of the 2nd quarter.17 The result is that the inventory in the Montréal CMA is considerably smaller than the provincial average18, and buyers looking for a new property are faced with an even more limited selection.
Sellers have the advantage in Quebec City
The Quebec City CMA continued to post interesting statistics for property owners in the year’s 3rd quarter. After an exceptional 2nd quarter, the real estate market has remained buoyant in the last few months. The market has been stable for over a year19, strongly benefiting sellers.
Selling price
Historically having a lower median selling price than the Montréal or Gatineau markets, the Québec City CMA is still catching up. Because of this, people wanting to buy have paid more to buy a property in the urban area of the Capitale-Nationale since July. This trend, which has been observed over several quarters, intensified toward the end of the last period, when, in September, the median price of single-family homes reached over $368,000.20
The same trend was observed for condos, as the median price in the 3rd quarter hit $262,000—an increase of slightly over 2% from last year.21
Selling times
Selling times in the region remained similar to the previous quarter’s. It takes 56 days on average to sell a single-family property in the Québec census metropolitan area.22
Although the trend is less significant in the Québec CMA than it was in the previous quarter, more than one third of owners who listed their property on DuProprio.com reported closing their transaction within 30 days. This is higher than the provincial average!23
Property inventory
The number of new listings declined 5% in the Québec market during the 3rd quarter of 2023.24 As for the number of properties, it has increased more than 12% in that period, compared to last year 23! Together, these two trends have led the property inventory in the Québec CMA to drop 6% compared to the previous quarter,26 settling at a meagre 3,552 properties.27 These factors work together to create a playing field that benefits sellers in that area.
Saguenay: Affordable but on the rise
Saguenay is an excellent market for owners wanting to sell their property. Though the market in that area is not as strong as in 2022, its statistics are stronger than they were at the start of this year.28
Selling price
In this seller’s market, the median price of single-family homes surged between July and September 2023, setting a record for the region. 29
Selling times
Property owners in the Saguenay CMA found buyers fairly quickly during the recent quarter. It took an average of 45 days to sell a single-family house.30 Over 40% of owners who listed their real estate on DuProprio.com reported having concluded their sales transaction in under 30 days31!
Property inventory
Despite a 4.6% increase in the number of new properties put up for sale in the Saguenay CMA, as compared to the same quarter last year,32 there was not a corresponding rise in the inventory. The number of sales transactions carried out in the last two quarters thus led to a lower number of properties for sale in the area. The inventory was a mere 474 properties—a drop of over 5% from the previous period.33 Because of this shrinking inventory, the market continued to offer better conditions for sellers than buyers.
Sherbrooke: Transition ahead?
In the Sherbrooke metropolitan region, several indicators continue to point to a seller’s market, despite a marked drop in vigour in the year’s 3rd quarter. Though the sampling period is short, the statistics tend to show that the Sherbrooke CMA is more in transition than the province’s other markets.
Selling price
Despite the market’s slower market momentum, the median price of single-family homes continued to rise significantly, reaching a historic quarterly peak of $380,000.34 This is almost 5% higher than in the same period last year35!
Note that nearly one in four property owners who listed their real estate on DuProprio.com in this area reported selling above market in the 3rd quarter36!
Selling times
The slight lull in the Sherbrooke CMA market was not reflected in selling times, which remained stable in the 3rd quarter at 48 days for single-family homes.37
Property inventory
A sign that the region’s market is in transition is that the inventory of properties available for purchase increased 11% in the 3rd quarter compared to the previous period,38 which is well above the provincial average. This phenomenon can be explained by two things: the number of sales transactions dropped 9% in that period,39 and the number of new properties put up for sale rose 3%, as compared to last year.40
While there was a hike in the property offering compared to demand in the Sherbrooke CMA, the real estate market has remained a seller’s market.
Return to a very active market in Trois-Rivières
The market in Trois-Rivières behaved differently than in other regions in the 3rd quarter. While overall, the provincial market showed strength in the 2nd quarter, there was already a slowdown in the Trois-Rivières CMA.
The 3rd quarter announced a return to a more active state. Several other indicators show that the region’s market still benefits sellers.
Selling price
While Trois-Rivières is known for being relatively affordable, it is gradually catching up to the rest of the province. The 3rd quarter ended with a median selling price of $313,899 for single-family homes,41 a 4% hike from the same quarter of 2022.42
The property owners in that region that used DuProprio’s services were able to benefit from the market’s vigour. More than one third reported accepting an offer higher than the last price listed for their property43! This episode of market overheating in the Trois-Rivières CMA was similar in magnitude to the one seen in 2022.44 This is a sign that the market in this area is extremely active.
Selling times
Considering the state of the market, selling times in the region remained very short in the 3rd quarter of 2023, at 38 days for single-family homes.45 This is the only CMA in which selling times were as short as they were last year.46 Nearly half of the owners who put their property up for sale on DuProprio.com reported selling within a month of listing.47
Property inventory
Not surprisingly, the number of properties offered on the market in this area continued to decrease in the 3rd quarter, making the Trois-Rivières CMA highly favourable for sellers. A 5% drop in new listings and no change in the sales transactions concluded, as compared to last year, resulted in a 15% inventory drop relative to the previous quarter.48
Trois-Rivières’ aspiring property owners had even fewer options in this last quarter, giving sellers the upper hand in the market.
Trend analysis and look forward
It’s impossible to deny that the latest increases in the key interest rate impacted Quebec’s real estate market. Generally speaking, we are seeing a swing back toward balance, but the advantage remains with people selling their property.
While many differences can be observed between regions, the key interest rate hike did not strongly affect the median selling price province wide. It continued to rise, settling at $395,000 in the 3rd quarter—a 2% rise over last year.49
Even though buyers have access to a wider selection than at the same time last year, the inventory of available properties in the province did not manage to rise substantially for the third quarter in a row. Only the Gatineau and Sherbrooke markets offered more options to aspiring owners.
This lack of choice can be explained by the drop in the number of owners wanting to sell50 and the stagnant number of sales transactions compared to last year.
This overall picture is appealing for sellers, but it’s important to highlight that the market is continuing its transition. This is notably reflected in increasingly marked differences between regions and between property types.
Want to get monthly statistics between our more in-depth analyses? Check the Quick Real Estate Minute frequently!
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