Led by condominiums often rented as apartments, Quebec has transformed into the engine of Canada’s residential real estate industry as tight inventory and strong rental demand push up prices, a new report shows.
Quebec City, in particular, has been posting some attention-worthy residential real estate results as home prices in the provincial capital posted a 16.5% year-over-year price increase, rising to $452,700 in the third quarter, real estate services firm Royal LePage said in its third-quarter Home Price Update and Market Forecast.
"This represents the highest year-over-year price increase among Canada’s major regions for the sixth consecutive quarter," the firm said.
Broken down by housing type, the national median price of a single-family detached home increased 1.2% year over year to $860,600 in the third quarter, and the median price of condominiums decreased 1.6%, to $580,700, Royal LePage said. Investors often buy condo units and add them to a market's multifamily rental pool.
Montreal also showed solid momentum, with homes prices rising 4.9%. The city is benefiting from renewed interest in urban living and a rebound in downtown activity, the report said.
“The island of Montreal is beginning to perform better,” said Marc Lefrançois a broker at Royal LePage Tendance, a group that specializes in luxury residential real estate. “We’re seeing more visits and new buyers, but they’re cautious. This is the best time to buy in five years.”
Dominic St-Pierre, an executive vice president at Royal LePage, said Quebec City’s inventory “has been quickly absorbed by strong demand,” underscoring the province’s leadership in multifamily growth.
Real estate sales in Quebec City are expected to remain robust as the population is projected to grow by over 100,000 people by the 2040s, while Montreal’s population is projected to decline by about 70,000, as reported by CoStar News.
Quebec regional markets are contributing to the trend of rising home prices in the province as well. Trois-Rivières recorded a 7% annual home price increase in the third quarter, while Sherbrooke saw a 4.6% gain, Royal LePage reported.
Both cities offer lower entry costs and consistent rental demand, making them attractive for workforce and affordable housing development.