There has been a lot of discussion lately about whether or not property in Montreal is over-valued. The increase in local property values over the last decade, coupled with the volatility seen in the US and other Canadian cities has caused many to ask whether we could be in a “housing bubble”. This question was recently addressed in an excellent presentation by Paul Cardinal, manager of market analysis for the Quebec Federation of Real Estate Boards (QFREB).

Mr. Cardinal looked at Montreal property values in relation to the 3 fundamental factors that affect value – income growth, interest rates, and population growth. His analysis showed that property values in the Montreal area have not significantly moved away from the evolution of these three factors. In fact, since 1989 our purchasing power has increased faster than property prices – or, put more simply – housing is more affordable today in Montreal than it was in 1989. The study concluded that it is highly unlikely that property prices in Montreal would see a “bubble”-like collapse. A more likely scenario is that property values will continue to increase over the next few years, but at a more modest rate as interest rates are projected to rise.

Our team keeps detailed market statistics, with a specific focus on West Island neighbourhoods. If you would like more information on your local market, please do not hesitate to contact us. It would be our pleasure to bring you up to speed.