27 Apr Is Affordable Home Ownership A Thing of The Past?
Is Affordable Home Ownership A Thing of The Past?
Montreal’s median prices for single family homes are $300,000 lower than they are in Toronto and $500,000 lower than they are in Vancouver. The lackluster condo market of 2015 was replaced by steady growth in sales in 2016. “Montreal registered the lowest unemployment rate in 30 years in December 2016 with immigration rates skyrocketing.
According to the Royal Bank of Canada, Vancouver and Toronto were ranked the first and second most unaffordable cities in Canada with Montreal ranked third. Now that both the Ontario and Vancouver real estate markets have imposed a 15% foreign ownership tax, Montreal is bound to enjoy the spill over effects. The home price Index in Toronto is $737,300, Vancouver 906,700, and Montreal $410,000, up 4% from 2015, according to JLR, a real estate market analyst.
Surprisingly, median salaries between the three provinces are very close with Montreal being within a $1000 less than Toronto or Vancouver. The same cannot be said for the housing markets as shown by the RBC affordability index. Data shows that 40% of gross family income would have to be spent on your home, Toronto 62%, and Vancouver 92%.
Here are some examples of price points in the different Montreal neighborhoods according to this excerpt from the Montreal Gazette article by Bert Archer:
Median price for a single family detached: $337,500 (all figures from centris.ca)
Go to Mile-Ex, and ask the first young woman with Dries lounge pants and mom-style sneakers where she’s opening her next pop-up DJ kiosk/bone broth stand she’ll tell you Villeray. Just like Mile-Ex was the next Mile End, and Mile End was the next Plateau, Villeray is the next Mile-Ex, and if you get in now, you can get ridiculous deals. Bonus incentive: According to CMHC rules you can get a mortgage with just five per cent down on the entire price of a home under $500,000. There aren’t many neighbourhoods in many Canadian cities – including Montreal – where this means you can get away with a pure five per cent down, but Villeray’s one of them.
Median price: $351,000
And Mercier-Hochelaga-Maisonneuve’s another. Both Cardinal and Fontaine mentioned this part of town as one they thought still had good values, but where prices would rise quickly. According to Fontaine, the number of families earning more than $80,000 a year doubled in this neighbourhood between 2010 and 2016, from 10-20 per cent. “It seems like it’s a neighbourhood worth investing in,” Fontaine said. The housing stock here is largely ‘60s- and ‘70s-style duplexes, the sort of squat, light brick jobs with below-grade garages out front that the typical Mile End dweller might scoff at. But look at Google Maps. It may not seem it quite yet, but this is downtown.
Median price: $456,000
There’s a price jump here, but look at that median – still well under the $500,000 mark. And I presume you’ve seen the Botanical Garden, at the Sherbrooke St. edge, as well as Jean-Talon Market. This neighbourhood’s going nowhere but up, and is the very definition of the sort of place – like Toronto’s St. Lawrence neighbourhood, for instance – that first-time buyers in 2030 are going to dream about living in on their commute from Terrebonne.
Median price: $469,750
Le Sud-ouest didn’t used to be a well taken care of part of town. But of course that’s changing now, and the property values have reflected it north of the Lachine Canal in Griffintown and St-Henri, but south of the canal is still a very good value, and will only get better as ice cream stands and street artists start to populate more of the 14.5-kilometre stretch of urban potential. Montreal’s newest and possibly coolest gin-maker, Cirka, set up shop there just last year. You could, too.”
*Information source – Centis and The Montreal Gazette