Metro Montreal
Real Estate Trends and Price Forecast

HIGHLIGHTS

• The Metro Montreal housing market is sending mixed signals heading into the next phase of the cycle.

• Detached houses continue to favour sellers, while townhouses and condo apartments have settled into balanced territory.

• Across every segment, however, inventory has been improving in favour of buyers, suggesting that the pendulum is gradually swinging back.

• Multi‑factor analysis identifies Metro Montreal as a moderate‑risk real estate market.

• Mortgage rates have eased from their peak but remain elevated relative to the 2010–2020 average, limiting buyer budgets.

• Economic uncertainty persists due to shifting immigration policies, trade tensions with the United States, the war in Iran, and ongoing fluctuations in interest rates — all factors that influence future market dynamics.

This article covers:

1. What is the state of the Montreal real estate market?

2. Which way are prices going?

3. Should I sell?

4. Is now a good time to buy?

1. Has the Montreal Housing Market Been Going Up or Down?

Overview of the Montreal Property Market

Metro Montreal is a sophisticated city of 4.3 million people that has earned recognition as one of the world's top 100 cities, coming in at number 35. Many would say that, culturally, Montreal is the most European city in North America.

Montreal is a city that offers a unique and vibrant living experience, blending North American and European influences. Here's a breakdown of why it's considered a great place to live:

• Cultural Richness: Montreal is known for its diverse, multicultural population, resulting in a rich tapestry of festivals, events, and cultural experiences.

• Vibrant Arts and Entertainment: Montreal has a thriving arts scene with numerous museums, galleries, and theatres. It's famous for its lively music scene and numerous festivals, including the Montreal International Jazz Festival.

• Foodie Paradise: The city boasts a diverse culinary scene, offering everything from traditional Quebecois dishes like poutine to international cuisine.

• Affordability: Compared to other major Canadian cities such as Toronto and Vancouver, Montreal generally offers a more affordable cost of living, particularly for housing.

• Walkability and Bike-Friendliness: The city is relatively easy to navigate, with walkable neighbourhoods and an extensive network of bike paths.

• European Charm: The architecture and feel of many parts of Montreal give it a distinct European feel, making it unique in North America.

The Reality Check: While Montreal remains more affordable than its biggest Canadian peers, affordability is still a meaningful challenge for first-time buyers, and the picture varies significantly by property type.

The months of inventory (MoI) in Metro Montreal, an important indicator of market balance, are currently sending mixed signals. Inventory has risen across every property type compared with a year ago, gradually tilting conditions back toward buyers. Detached houses, however, continue to favour sellers, while townhouses and condo apartments have moved into balanced territory.

Metro Montreal Detached House Prices

The detached house market remains a seller's market, but inventory is trending in favour of buyers. Months of inventory have risen compared with last year, purchase demand has softened, and the supply of active listings has edged higher.

Despite the easing in market tension, benchmark and median detached prices have continued to push higher over the most recent three-month period, suggesting that well-located, well-presented homes are still commanding firm pricing even as buyers gain a bit more breathing room.

Heading into the next cycle, the detached segment looks stable but more selective. Outcomes will depend heavily on location, condition, and pricing strategy.

Metro Montreal New Construction Home Prices

New home prices have shown an upward trend in the short term but have remained broadly stable over the past few years. Construction activity is running above typical levels, which could create medium-term absorption challenges, a dynamic similar to what has unfolded in Toronto.

Does this concern you? Read the Pros and Cons of Buying Pre-sale Homes

Pre-sale buyers should be cautious about paying a premium in the current market. Direct price cuts from developers remain rare, but buyers may be able to negotiate concessions such as upgraded fixtures, additional parking, or storage.

Market Risk

Montreal's detached segment is at moderate risk of a market correction. It remains a seller's market, with months of inventory roughly consistent with last year. Prices have been highly volatile since 2021 and remain disconnected from local incomes, with the benchmark price sitting well above the four-to-six times income range generally considered sustainable. Construction levels are running higher than normal, which could lead to absorption challenges and prompt developers to offer perks or discounts. On the positive side, Montreal is a large market with a deep buyer pool, so sellers should still find buyers even during slower phases.

The condo segment also carries moderate risk, but the underlying picture is healthier. It is a balanced market, with inventory rising strongly in favour of buyers. Prices have been stable and remain broadly affordable relative to local incomes, sitting within the sustainable range. Construction activity, however, is well above normal, raising the likelihood of absorption challenges and potential developer concessions. The condo buyer pool is closer to average in size, but sellers should still find buyers in a slow market.

Across both segments, rates remain in the easing phase of the cycle. Lower rates increase buying budgets and tend to stimulate property markets, though it can take up to 18 months for the full impact of easing to be felt.

Overall, Montreal faces a moderate risk of experiencing a market correction, with the detached segment carrying more bubble risk than the condo apartment segment.

Metro Montreal Condo Apartment Prices

The condo apartment market is balanced and trending in favour of buyers. Months of inventory have risen sharply compared with last year, the largest year-over-year shift of any segment, giving buyers stronger negotiating leverage. Purchase demand has dropped while active listings have grown materially.

Price action is mixed: benchmark condo apartment prices have edged up over the past three months, while median values have softened slightly, hinting that lower-priced units are seeing more competition while higher-quality stock is holding its value.

With more people working from home or hybrid, we expect developers to continue marketing larger two- and three-bedroom layouts to meet evolving buyer preferences, which over time may add further pressure on values for smaller floor plans.

Metro Montreal Townhouse Prices

The townhouse market has settled into balanced territory, with buyers and sellers holding roughly equal negotiating power. Inventory has improved in favour of buyers, with months of inventory rising notably year over year. Purchase demand has eased, while the supply of active listings has crept higher. Even so, both benchmark and median townhouse prices have moved up over the past three months, indicating that sellers retain meaningful pricing power despite the softer demand backdrop.

Still a challenge for first-time homebuyers

Montreal remains more affordable than Toronto or Vancouver, but affordability is still a real hurdle for first-time buyers. A typical first-time homebuyer household earning the local median income can secure only a modest mortgage — well short of what is needed to buy a typical condo apartment without a substantial down payment. For many households, that gap can only be bridged with help from family.

What about the rest of Canada?

Read the Toronto Real Estate Forecast, Ottawa Forecast and the Metro Vancouver Forecast.

2. Where Are Metro Montreal Home Prices Headed?

There is significant uncertainty in the forecasts for the next several years. Recent trends point to softening demand in most segments, rising inventory levels, and mixed price movements. Detached and townhouse prices have shown short-term strength but face longer-term headwinds. Condo apartment prices have stabilized but are showing signs of buyer-friendly pressure. Meaningful price appreciation over the next few years may be limited unless there is a substantial change in underlying fundamentals.

Our 5-Factor Analysis

We assess five forces that help explain why several forecasters are anticipating softer price performance or potential price drops: Core Demand, Non-Core Demand, Supply, Government Interventions, and Consumer Sentiment.

How do we arrive at our forecast range? READ REPORT: 5-FACTORS DRIVING MONTREAL HOME PRICES

Key External Variables

Outside the 5-factor model, there are external factors that could have a knock-on effect on the market. These include:

• Will the war in Iran lead to higher mortgage rates, as the Bank of Canada is forced to combat inflation caused by higher gas prices?

• As a result of the federal government's immigration policy pivot, how much lower will population growth be compared with recent years?

• Will mortgage rates reset at a new normal range that is higher than Canadians have grown used to, or will they return to pre-pandemic levels?

• Will Canada's trade dispute with the U.S. lead to weaker economic growth or a recession that would further pressure housing demand and prices?

Methodology

At Mortgage Sandbox, we provide a price range rather than attempting a single prediction because many real estate risks can impact prices. Risks are events that may or may not happen. As a result, we review various forecasts from leading lenders and real estate firms. We then present the most optimistic estimates, the most pessimistic prediction, and the average forecast.

Our forecast inputs:

• CMHC Housing Outlook

• Reuters Housing Forecast Poll

• Royal LePage House Price Forecast

• RE/MAX Housing Market Outlook

• Canadian Real Estate Association Quarterly Forecast

• RBC Home Resale and Price Forecast

• TD Bank Economic Housing Outlook

• BMO Housing Outlook

3. Should I Sell?

Annual Real Estate Cycle

The annual real estate cycle usually favours sellers in the first half of the year, and this seasonal pattern remains relevant in the current environment.

Current Strategies

Conditions vary by property type. The detached segment continues to favour sellers, and benchmark prices have been moving higher in recent months — a constructive backdrop for owners considering a sale. Townhouse sellers are operating in a balanced market but still benefit from upward price momentum in both benchmark and median measures. Condo apartment sellers face the most challenging conditions: although the market is balanced, inventory has risen sharply in favour of buyers, demand has cooled, and median prices have begun to soften. Well-located, well-presented condos can still achieve strong outcomes, but price competition is increasing.

With possible headwinds from a U.S. trade dispute or weaker economic conditions later in the year, those planning to sell may benefit from acting earlier rather than later.

Professional Advice

Our analysis is at the macro, bird's-eye level. There are nuances at the neighbourhood level depending on the property type and condition.

Sellers should always consult a mortgage broker early to prioritize flexible loan conditions and reduce the risk of mortgage cancellation penalties. Also, consult more than one real estate agent. Sometimes agents will tell you what you want to hear so they can win the listing and then lower your expectations once you are bound to the contract. You will want a realistic assessment of which cosmetic changes are needed to lift the perceived property value, what comparable homes have recently sold for, and where the market is trending.

Planning to Sell? Check out our Complete Home Seller’s Guide.

4. Is now a wise time to purchase property?

Annual Real Estate Cycle

The annual real estate cycle usually favours buyers in late summer and autumn, and this pattern is expected to persist into the coming years.

Current Strategies

For buyers, the answer depends on what you are looking for. Condo apartments offer the strongest buyer leverage, inventory is up materially, demand has cooled, and median prices are softening. Townhouses sit in balanced territory, with rising inventory beginning to give buyers more room to negotiate, even though prices have edged higher recently. Detached houses remain the most seller-friendly segment, with prices continuing to rise in the short term, though the build-up of inventory suggests the window of maximum seller advantage may gradually narrow.

For those buying a forever home with a ten-year horizon, the risks of buying now are lower than they were a year ago. However, timing the market perfectly is almost impossible. Do not bite off more than you can chew when it comes to financing.

Professional Advice

Buyers should always consult a mortgage broker early in the process to obtain a pre-approval. Although current interest rates are easing, they could rise again within the next 9 to 18 months. With pre-approval, you can lock in a rate for up to four months before closing, helping mitigate financial risk.

Additionally, it is wise to consult more than one real estate agent. You need someone who will work with you on your terms. Buyer agents can increase their commission income by encouraging you to spend more or transact more quickly. Their earnings are tied to total annual transaction volume, so they earn the same commission regardless of how much time they spend helping you find a home that meets your needs and has strong long-term investment potential.

Are you Planning to Buy? Check out our Complete Home Buyer’s Guide so we can walk you through the end-to-end process and get you ready to buy your new home!

Here are some recent headlines you might be interested in:

• Tempered enthusiasm': No spring real estate bloom, but buyers are slowly coming back (CTV News | May 19)

• Montreal CMA: Economic Uncertainties and Household Caution Weigh on April Sales (GlobeNewswire | May 05)

• Bank of Canada holds key interest rate at 2.25%, warning future decisions are clouded by uncertainty (CBC | Apr 28)

• House prices dropping in Canada's most expensive cities, but still out of reach for many (CBC | Apr 26)

• Mixed start to Canada’s housing markets’ busiest season (RBC | Apr 26)

• From where the deals are to where prices dropped most, 5 key things to know about the spring real estate market (Financial Post | Apr 26)

• March marks four years of declining home prices in Canada (RBC | Apr 26)

• How the war in the Middle East is already impacting mortgage rates in Canada (CBC | Apr 26)

• Say goodbye to fixed mortgage rates below 4% (Financial Post | Apr 26)

• War adds ‘uncertainty premium’ to Canadian mortgages as fixed rates jump (Wealth Professional | Apr 26)

Like this report? Like us on Facebook.