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Montreal's Housing Market Continues to Slow in May, Says National Bank

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According to National Bank of Canada's preliminary estimate based on Centris data, Montreal's seasonally adjusted home sales fell by 1.8% in May from April, following a 4.3% decline the previous month.

This marks the fifth decline in seven months, noted the bank.

This weakness comes amid trade and geopolitical uncertainties, a recent rise in fixed mortgage rates due to soaring inflation and a significant deterioration in the labor market in the Montreal region since the start of the year, stated National Bank.

In fact, the unemployment rate in the Montreal Census Metropolitan Area (CMA) jumped from 6.3% in January to 7.7% in April, very close to the 7.9% observed in Toronto. If this weakness in the labor market is confirmed by data in the coming months, there is a risk of further deterioration, added the bank.

For now, transactions in the Montreal residential market are at their historical average in May. This situation contrasts with the markets in Vancouver and Toronto, where home sales in May are 32.7% and 18.3% below their long-term averages, respectively.

National Bank believes the relative resilience of the Montreal market is partly due to better affordability conditions in the Quebec metropolis.

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