Urban exodus hasn't touched house prices in Montreal Island: study

[Malek]

Urban exodus hasn't touched house prices in Montreal Island: study

Mike King, Montreal Gazette

Published: Tuesday, June 03

Urban sprawl doesn't appear to have had a negative effect on Montreal Island house prices.

 

While 2007 marked the fifth year in a row that Montreal and its on-island suburbs suffered a net loss of approximately 20,000 residents, according to the Institut de la statistique du Québec, Royal LePage Real Estate Services Ltd. notes house prices have soared over the past decade.

 

For example, results of Royal LePage's national Urban vs. Suburban Survey released yesterday show the average price of a bungalow in the city appreciated by 130 per cent to $253,125 during the past 10 years while its suburban off-island counterpart rose by 99 per cent to $226,273.

 

 

 

At the same time, the price of a standard two-storey urban home climbed 120.5 per cent to $307,400 compared to a 107-per-cent jump to $265,625 in the 'burbs.

 

The survey examined five urban (Notre Dame de Grâce, Beaconsfield, Dollard des Ormeaux, Dorval and Pointe Claire) and four suburban (St. Lambert, Boucherville, St. Bruno and Laval des Rapides) markets.

 

Gino Romanese, Royal LePage senior vice-president in Toronto, explained in a phone interview there has been "greater demand than supply the last 10 years despite that exodus (of Montrealers)."

 

"The combination of a shortage of inventory and virtually no space in the city for new development led to the significant gains that Montreal experienced over the past decade," he added. "Also contributing to the city's rising house prices is the fact that historically, Montreal's prices were well below the Canadian average."

 

Romanese said "as the country experienced a rapid expansion cycle in the early 2000s, Montreal followed suit with house prices near, or more than, doubling."

 

He pointed out urban enclaves such as N.D.G. hold the most appeal to homeowners because of their proximity to businesses, trendy shopping areas, restaurants and public transit.

 

"The preference for urban dwelling has helped fuel healthy price increases in recent years, with the sharpest rate of appreciation taking place in the past five years."

 

The survey found that shortages of inventory in popular urban residential markets caused many purchasers to look to the urban periphery and then to the suburbs to satisfy their housing needs.

 

"Looking ahead 10 years, it is likely that both Montreal's urban neighbourhoods, as well as their surrounding suburbs, will both see solid price appreciations," Romanese said. "With the city's transit system anticipated to eventually extend out to the St. Lambert area, it's likely more people will consider moving away from the city."

 

But stressing that Montreal remains "a vibrant city with some of the finest restaurants and cultural activities in the country, there are buyers who will always clamour for a home in the heart of the city."

 

He suggested the local situation anwers the age-old question of whether it's best to live in the city or the suburbs.

 

"It depends on what you're looking for, it's a lifestyle choice and by and large, whether you invest in an urban or a suburban area, you should do equally well if history (of the past decade) repeats itself."

 

mking@thegazette.canwest.com

 

 

 

 

© The Gazette 2008

[begratto]

The survey examined five urban (Notre Dame de Grâce, Beaconsfield, Dollard des Ormeaux, Dorval and Pointe Claire) and four suburban (St. Lambert, Boucherville, St. Bruno and Laval des Rapides) markets.

 

On n'a pas tout à fait la même définition d'urbain. Pour moi, leur seul quartier urbain est Notre-Dame-de-Grâce. Même que Saint-Lambert est plus urbain que DDO, Dorval et Pointe-Claire.

[JCC-Fromthere]

No space in the city? I'm assuming they speak of a shortage of built dwellings. There's plenty of space everywhere for new construction. Incidentaly, I did an exercise of roughly identifying the surface parking spots downtown just a few days ago (that's just downtown, I didn't have time to do more). The island of Montreal is not especially densily built.

 

Quite telling:

http://resultbasedpolitic.blogspot.com/2008/06/surface.html

[Malek]

Nice map!

 

But those lands aren't readily available to be built, they are owned, and their owners have to let go... which is easier said than done.

[JCC-Fromthere]

Nice map!

 

But those lands aren't readily available to be built, they are owned, and their owners have to let go... which is easier said than done.

 

So, if there is indeed space, albeit owned and there's strong demand for it, but it isn't developed, then there's something that's failing the market.

 

Methink it is still too easy to make money with surface parking lots in Montreal as opposed to developing them.

[Malek]

Exactly, its easy "grey" money.