Real estate markets in Montreal saw an upswing this fall as enthusiastic buyers headed over to buy condos leading to prices increasing about 5 percent.
According to a report from online realtor BuzzBuzzHome, investor enquiries for Ontario developments declined 72 percent between the first and second quarter, But Montreal saw a 91 percent increase in investor inquiries.
This could be due to the new rules which impose a 15 percent tax on foreign buyers and deals with rent control measures. Montreal is now a hotspot for condo buyers and is seeing an increase in condos being built. However Vancouver and Toronto real estate sales would increase in the future, a report said.
Sotheby’s International Realty Canada said the country’s economic performance would boost real estate markets in the coming months despite the policy changes being made. High property prices, which had become an issue of concern, had cooled down in the wake of the recent real estate regulations.
“The psychological confidence that people had in the marketplace was shaken by all of the different factors that were put in there,” Brad Henderson, CEO of Sotheby’s International Realty Canada recently told a media organization when asked about the recent drop in sales in properties of more than $1 million in Toronto.
The new 15 percent tax on foreign buyers in Ontario which was introduced by the provincial government contributed to the drop in sales according to experts. The tax, introduced in late April, was similar to the one imposed in British Columbia in fall 2016.
Toronto’s market was impacted by not just the 15 percent foreign buyer tax but also a stricter money lending policy by the federal government and increases in lending interest rates. Vancouver too reported a drop in sales of luxury real estate properties during the beginning of the year but slowly picked up activity after July.
While Toronto saw interest from investors dwindling, there was a different sentiment in Quebec where the provincial government has not intervened yet. In Montreal, sales of condos and houses over $1 million increased by 60 percent in July and August.
Montreal would “emerge as a strong leader on Canada’s luxury real estate landscape this fall,” Realtor Sotheby’s said in a recent report. While foreign buyers are likely to be interested in Montreal due to the tax policy, there are other advantages of choosing Montreal including the lower real estate prices, experts said.