– The QFREB unveils a study on sales concluded above the asking price –
L'ÎLE-DES-SŒURS, QC, May 30, 2018 /CNW Telbec/ - The Québec Federation of Real Estate Boards (QFREB) has published a study showing that the proportion of residential properties that sold for more than the asking price has risen over the past year in each of the province's six census metropolitan areas (CMAs).
Québec's residential real estate market has had a good start to the year: sales are up while the supply of properties for sale is down. "In this context, we see increased pressure on prices and more frequent situations of bidding wars," explained Paul Cardinal, Manager of the QFREB's Market Analysis Department. "In most cases, when a property sells for more than the asking price, it is because a bidding war has taken place," he added.
The phenomenon of sales concluded above the asking price was most prevalent in the areas of Montréal and Gatineau, where the number of months of inventory were the lowest. In the Montréal CMA, which is currently in a seller's market, one in ten properties sold for more than the asking price. In the Gatineau area, this proportion was 7.2 per cent, which corresponds to about one in 14 sales.
In addition, it was generally plexes (small rental properties with two to five dwellings) that sold for more than the asking price. This was particularly the case in the Montréal, Québec City, Sherbrooke and Trois-Rivières CMAs. The Gatineau area was the exception, as sales above the asking price were most prevalent among single-family homes.
The Montréal area stood out
It was in the Montréal CMA – the only CMA in the province that is firmly in a seller's market – that sales concluded above the asking price were most prevalent. It was also the CMA where this phenomenon increased the most over the past year. Sellers have the upper hand in negotiations, particularly on the Island of Montréal.
For single-family homes, several municipalities in the West Island stood out, such as Pointe-Claire (31 per cent), Kirkland (26 per cent), Beaconsfield (25 per cent), Dollard-des-Ormeaux (21 per cent) and Dorval (20 per cent), which registered the highest proportions of sales above the asking price. However, first prize goes to the area of Rosemont/La Petite-Patrie, where nearly one in three single-family homes sold above the asking price in the past 12 months.
As for condominiums, the proportion of properties that sold above the asking price was lower, because scarcity is lower on the condominium market as compared to single-family homes. But despite this, areas such as Le Plateau-Mont-Royal, Rosemont/La Petite-Patrie, Villeray/Saint-Michel/Parc Extension, Outremont and South West are worth pointing out, with proportions ranging from 12 to 16 per cent.
Finally, in some central neighbourhoods, plexes were so popular that the selling price of more than one quarter of transactions exceeded the asking price. This was particularly the case in Verdun/Île-des-Soeurs, Rosemont/La Petite-Patrie, South West and Le Plateau-Mont-Royal.
How much above the asking price did people pay?
For properties that sold above the asking price, we calculated the difference between the sale price and the asking price, in dollars and as a percentage, in each of the province's CMAs. The percentage differences do not seem particularly significant from one region to another: they vary from 2.5 per cent in Gatineau to 3.7 per cent in Québec City. But of course, when measured in dollars, the Montréal CMA registered the largest difference, as buyers who were engaged in bidding wars paid an average of $15,072 more than the asking price. This was followed by the Québec City and Sherbrooke CMAs, where buyers paid an average of $10,030 and $7,958, respectively, above the asking price.
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About the Québec Federation of Real Estate Boards
The Québec Federation of Real Estate Boards is a non-profit organization composed of Québec's 12 real estate boards and the close to 13,000 real estate brokers who are their members. Its mission is to support Québec's real estate boards in order to defend, protect and promote the interests of real estate brokers through the provision of services in the areas of professional practices, public affairs and market analysis. The QFREB is guided by an approach that is centred on collaboration and resource sharing.
SOURCE Québec Federation of Real Estate Boards
For further information: Jacynthe Alain, Assistant Manager, Communications and Public Relations, Québec Federation of Real Estate Boards, Cell: 514-647-8249, [email protected]