August Sales: The Pauline Effect
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The Westmount real estate market crawled almost to a stop in August, with only two house sales posted by agents, the lowest number of sales in August since we began keeping statistics in 1986. We added two more sales to the four we had reported for July — one for $3,500,000 and one for $505,000 — but this only brings the mid-summer sales volume to eight.
Much of the blame must be placed on the Quebec political situation and the notion that few buyers are willing to invest upwards of $1 million while the provincial economy suffers and attention turns to “values” and corruption. In fact,there were as many rentals of houses during July and August as there were sales, for amounts ranging from $3,050 to $8,100 per month, an indication that the potential buyers do not want to invest in Quebec right now.
Even the condominium market was suffering, with only one new sale reported in August compared to two in July, during which time agents arranged 20 rentals ranging from $1,050 to $3,700 per month, many of them divisible condos which usually are sold rather than rented.
Meanwhile, the number of houses on the market in Westmount has climbed from 144 in early August to 151 last weekend, and the number asking more than $2 million is up from 57 last month to 60 in September, proportionally about the same.
For the record, the two house sales recorded in August were both in the range of $1 to $1.5 million; one had been on the market almost five months and the other almost a year. The average markup was only 10 percent above municipal evaluation, well below the 24.6 percent average for the year to date. Volume for the year through August is only 90, higher than the 71 sales recorded through the first eight months of 1994 but otherwise the lowest number of sales since we started keeping records in 1986.
Thus it is clear that the market is still falling in Westmount and this probably will continue until the political situation changes course. Still, we are well above the averages from two years ago, so most homeowners can take comfort that their real estate still has been a positive investment.
President at Andy Dodge & Assoc. Inc.