A “sharp” deterioration in access to property in Greater Montreal

Access to home ownership has been reduced in the greater Montreal area while the median selling price of single-family homes has exploded by 71% on the island of Montreal over the past five years.

A “sharp” deterioration in access to property in Greater Montreal

Access to home ownership has been reduced in the greater Montreal area while the median selling price of single-family homes has exploded by 71% on the island of Montreal over the past five years.

• Read also: A majority of Quebecers give up the idea of ​​buying a house in the midst of a real estate crisis

• Read also: 205,400 workers still at minimum wage in Quebec

This is what emerges from the Housing Portrait, a report just published by the Montreal Metropolitan Community (CMM), which brings together 82 municipalities in the Greater Montreal area.

“In the current context, with the shortage and the need to optimize the available space without encroaching on natural and agricultural environments, it is imperative to plan the development of housing well,” said the mayor of Montreal, Valérie Plante, who is also president of MWC.

The rise in real estate prices began to accelerate around 2017, reaching record highs during the pandemic period. Greater Montreal would be one of the North American regions most affected by the phenomenon.

The report notes that since this period, there are "too few" homes for sale, compared to demand. For 2021, it would have taken between “24,000 and 32,000 additional homes available for sale to reach a balanced ratio of 8 to 10 sellers per buyer”, the proportion currently being at 2.4.

On the island of Montreal, the median selling price of single-family homes has exploded by 71% over the past five years, reaching $722,500.

"In 2021, for tenant households in the region earning $59,000 or less per year, it is not, for all practical purposes, possible to acquire a single-family home that is affordable to them on the island of Montreal", is stated in the report.

“Even for a household with an income of $100,000 – which would thus be among the 20% of the wealthiest renter households – [only] 30% of the houses offered for sale on the island of Montreal could be considered affordable”, is also noted.

The median cost of condominiums also increased by 47% in the Montreal agglomeration, to reach $431,500.

“Still on the island of Montreal, no category of condominiums is affordable for a household earning less than $48,000,” we can read.

CMM analysis shows that residential property prices have increased by 90% since 2011, while household income has only increased by 40% during the same period.

An increase that affects housing

According to the CMM, it is becoming more and more difficult for households earning less than $50,000 per year to find housing without spending more than 30% of their gross income on rent.

“The rapid increase in the cost of rents has weakened the economic situation of many households in Greater Montreal and the overall increase in housing costs could have an impact on the attractiveness of the region,” warns the report.

More than a third of tenant households in the CMM must pay more than 30% of their salary to pay the rent, and about 15% must devote more than 50% of their income to it.

Several dwellings have been built in the last two years. The price of rents for a two-bedroom unit is however around $1,500, while it is more like $930 for the rest of the rental market.

"A direct effect of the lack of affordable housing is that many low-income households are forced to live in poorly maintained, even unsanitary housing," pointed out the report, which however indicated that "little data is available concerning sanitation of housing.

By 2041, the territory of Greater Montreal should have 243,000 new households, according to projections that the CMM carried out with the Institut de la statistique du Québec (ISQ).

“A projected growth which is mainly based on international immigration in the central sectors and on intrametropolitan migration in the crowns”, it is specified.

The report notes that several households who have lived part of their lives as young adults in Montreal “tend to migrate to more peripheral sectors”, in particular with the aim of accessing property.

However, these are replaced by new households, mainly from immigration.

The result of these various movements makes the island of Montreal the sector of the CMM which “experiences, in absolute numbers, the strongest demographic growth”.


1

NEXT NEWS