September Sales: On Hold

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The Westmount real estate market slowed to a near stop after the September 4 provincial election brought the Parti Québécois to power for the first time in nine years. Two house sales, both over $1 million, were logged on September 6, then four more were negotiated in the following three weeks, one for $2.8 million — the highest price negotiated since April — and the other three below $1 million. The average monthly volume is 11.5, so this year is just over half the average.

The low number of sales has a tendency to skew the price figures, and though the adjusted average price moved up slightly, the main message is that the market has not completely collapsed, just gone on “hold” until buyers determine the impact of a minority government on their major investment.

In 1994, when Daniel Johnson, Jr., took over the Liberal Party from Robert Bourassa and then lost the September election to Jacques Parizeau, Westmount suffered its worst volume in recent history, and in fact only three sales were posted in September. Other than that, the six sales logged this year match the September volume in 1991 and 2001, but except for those years, this is the lowest for a September in the last quarter=century. On a year-to-date basis, 2012 has been fairly good compared to the past five years; September heralds the lowest monthly volume so far this year.

Five condominium sales last month indicated an improvement in that market, compared with one each in July and August. All five in September were high-rise apartments, one in the newly-constructed 11 Hillside Ave. building and one at 1250 Greene Ave., now nearing completion. Among the resales, prices have moved up only slightly in the past year, with sale prices averaging about 18 percent above municipal valuation in both 2011 and 2012.

Things were slow in adjacent-Westmount, as well, with only two homes sold, one just north of Westmount and the other just east. In September last year there were 10 sales reported, bringing the total in all adjacent-Westmount areas (including the “Golden Square Mile”) for the first nine months to 62, 72 for the entire year. This year there have been only 45 one- and two-family dwelling sales so far.

Perhaps indicative of the buyers’ heistancy, eight rentals were reported in September, of which four were houses.

Posted by andy Posted in: Monthly Analysis No Comments » September 2012