May Sales: Cleaning Up

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Westmount’s real estate market was something of a disappointment in May, following an exceptional April when the (unadjusted) average price soared to $1,350,000 and three sales were over $2 million.

Only 11 home sales have been posted so far for May, compared with an average of more than 21 in previous years, and compared with 18 posted last April. Of the 11, five had been on the market more than 200 days, an indication the vendors were getting desperate; of those five, four sold under municipal assessment as low as 62 percent of the tax value. One house which had been advertised regularly for over a year sold for $250,000, the lowest price for a single-family dwelling in Westmount since 2002. Highest price was only $1,080,000 and only three houses cleared the $1 million mark, compared to 13 of the 18 in April. The raw average price for May was $825,273, but statistically the average price stayed at the $1,150,000 level.

The strong showing in April has helped to push the averages up generally; so far the second quarter statistics indicate a 12.9-percent price increase compared to the first quarter. The fact that so many long-standing listings finally get cleared out of the inventory means that prices should move ahead later in the year, and new listings are coming very late this year. Agents say there are still plenty of buyers out there, though usually by June everyone who plans to move in the summer months has committed themselves to a house.

Only one condominium sale was logged in May, compared to five in April, and markups in the second quarter are lower than they were in the first quarter of 2009. On the other hand, house rentals are way up this year compared to last: 16 houses have been rented through the Multiple Listing Service so far this year compared with only 10 last year, with this year’s rents ranging from $2,300 to $10,000 per month.

Adjacent-Westmount sales were strong both in April and May, especially on the four streets to the west of the city in Notre Dame de Grâce, where there were 7 sales in April and 6 in May. Last month also logged two home sales on Circle Road, one just east of the city limits and one in the “Golden Square Mile.” Prices are generally lower than they are in Westmount — the N.D.G. sales averaged $670,442 — which may indicate that there is a bit of resistance to the million-dollar-plus asking prices in Westmount.

Most agents seem hardly ready to slow down for the summer yet. With the season stalled by hesitancy in the first three months, buyers are beginning to show signs of commitment now. We can’t say the recession is over, but certainly it is not as gloomy as it was in January.

Posted by andy Posted in: Monthly Analysis No Comments » May 2009