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Montreal homebuyers wary of election uncertainty

Montreal homebuyers wary of election uncertainty

Although Parti Qu&#233;b&#233;cois leader Pauline Marois hasn&#8217;t committed to a date for a referendum on sovereignty, some buyers and real estate experts fear a PQ victory would generate uncertainty, leading to weakening demand &#8212; especially by out-of-province investors &#8212; for Montreal properties.
 

Although Parti Québécois leader Pauline Marois hasn’t committed to a date for a referendum on sovereignty, some buyers and real estate experts fear a PQ victory would generate uncertainty, leading to weakening demand — especially by out-of-province investors — for Montreal properties.

Photograph by: Graham Hughes , The Canadian Press

MONTREAL - Real estate circles are buzzing with speculation that a Parti Québécois victory would adversely affect Montreal property values, but experts point out there is no widespread evidence of sales dropping before the Sept. 4 election.

Although Parti Québécois leader Pauline Marois hasn’t committed to a date for a referendum on sovereignty, some buyers and real estate experts fear a PQ victory would generate uncertainty, leading to weakening demand — especially by out-of-province investors — for Montreal properties.

Earlier this week, the PQ leader dismissed a media report about several buyers putting off their purchases of high-end homes until after the election as scare-mongering.

In fact, Actualité magazine reported that Marois and her husband, Claude Blanchet, are in the process of buying a new residence in Old Montreal, after selling their sprawling Île Bizard home last year. A Marois press aide refused to comment on any purchases of property by the couple.

A report in La Presse this week quoted individual brokers whose clients asked to delay their purchases of luxury homes in Westmount, Hampstead and other neighbourhoods until after the election. And a July report in The Gazette described fears that a PQ victory could discourage out-of-province investment, which has played a greater role in the Montreal real estate market in recent years.

Carl Rémillard-Fontaine, a broker with Profusion Immobilier, said he has heard concerns expressed by high-end French- and English-speaking buyers in areas like Westmount, downtown Montreal and Nuns’ Island.

“Yes, I have had many people visiting and when we call for feedback they tell us, ‘we will wait for after the election,’ ” he said.

Real estate broker Monique Assouline said she’s had both English- and French-speaking clients ask to put off buying west-end homes in all different price ranges until after the election.

The overriding fear is losing money on such a big investment.

Despite this perception by buyers, there is no conclusive data linking the presence of a PQ government since the last referendum and a drop in home prices. Figures from the Greater Montreal Real Estate Board since the 1990s show the median price of a single family home in Westmount — and the region — has generally appreciated regardless of which party was in power.

Prices did drop during the mid-1990s, during the time of a referendum on sovereignty. But economists note that it was also a time of recession compounded by government fiscal austerity measures.

Average sale prices also dropped during the mid-1990s in Toronto, figures show.

Yet some blame politics and high taxes, among other factors, for Montreal’s comparatively low real estate values, which continue to trail the national average. According to the latest data from the Canadian Real Estate Association, the average price of a Montreal home is $331,577, which lags behind the average price even in smaller markets like Edmonton and Ottawa.

Dominic St-Pierre, director of Royal LePage for the Quebec region, said he has heard anecdotes from brokers of certain high-end buyers — especially ones from outside the province — putting off sales. But such comments aren’t widespread and don’t appear to be affecting sales, he said.

“There are people who are bringing it up in high-end real estate, but we don’t think it’s broadly influencing the market,” St-Pierre said.

Most buyers and brokers, he said, make the distinction between the simple election of a PQ government and the holding of an actual referendum, which would probably have an impact on home prices.

Marois has compared fears about a current PQ victory to events from decades ago.

“You know, some years ago, for the first referendum, the Brinks society decided to go outside of Quebec with its big truck, and I think it’s the same thing when you talk with realtors. So I’m not afraid of that,” Marois told a press conference.

Marois was mistaken in saying the incident dated back to the 1980 referendum campaign.

In fact, the story dates back to 1970, according to a 1972 book titled Quebec: a Chronicle, by late Gazette columnist Nick Auf Der Maur and Robert Chodos. Alarmed by opinion polls showing a rise in support for the fledgling PQ, Auf Der Maur and Chodos wrote, the “Royal Trust Company packed some securities into a Brinks truck and pointed in the direction of Toronto – making sure a Montreal Gazette photographer was there to get pictures.”

The story, known among Quebec sovereignists as “le coup de la Brinks,” came to symbolize fear tactics by the business community to discourage Quebecers from supporting independence.

alampert@montrealgazette.com

Twitter: @RealDealMtl

Marian Scott of The Gazette contributed to this report