With the beautiful days of fall weather behind us, the first flurries of snow appeared in late November, preparing us for winter activities and the holiday season ahead. For some, the prospect of purchasing a winter recreational property is the perfect place for a family getaway, enjoying retirement, or to collect rental income. Whatever the reason for the purchase of such a property, or the sale of one, it is important to be aware of current market trends.
The median price of a single-family detached home in recreational real estate markets around the major ski hills in Quebec increased 14.3% to $488,600 during the first 10 months of 2022, compared with the same period in 2021, according to the Royal LePage 2022 Winter Recreational Property Report. Meanwhile, the median price of a condominium located near one of the province’s main ski destinations increased 33.2% year-over-year to $404,500.
During the same period, the number of detached single-family home and condominium transactions in the regions surveyed decreased 30.2% and 34.7% year-over-year, respectively; a sign of weakened demand from buyers who remained on the sidelines, waiting for prices to correct and for the upward trend of interest rates to slow.
Among the ski regions studied, the steepest increase in property prices province-wide was in Mont-Tremblant (Mont-Tremblant, Saint-Faustin–Lac-Carré and La Conception). The median price of a condominium in the region jumped 44.4% year-over-year to $475,000, between January 1st and October 31st, 2022. Meanwhile, the median price of a single-family detached home rose 23.5% to $500,000 during the same period.
Paul Dalbec, a chartered real estate broker with Mont-Tremblant Real Estate, a division of Royal LePage, says that the Mont-Tremblant real estate market is in the midst of transitioning from a seller’s market to a buyer’s market, which explains the sharp decline in sales. With interest rates moving higher, many potential buyers have adopted a wait-and-see attitude.
A sign that the recreational market is slowing down, two markets surveyed saw a decrease in the median price of single-family homes. In the regions of Mont Sutton, including Sutton, Brome and Lac-Brome, the median price of a single-family detached home decreased 3.0% year-over-year to $548,000, since the beginning of 2022. Likewise, the median price of a single-family home in Bromont dipped 0.9% year-over-year to $586,000. This is a notable contrast to 2021, when Bromont stood out as the winter recreational market with the strongest growth in median property prices.
“The runaway home price increases we saw in the Eastern Townships between 2020 and the first half of 2022 have resulted in a migration of demand toward less congested and less expensive markets,” explains Véronique Boucher, real estate broker with Royal LePage Au Sommet. “Some real estate markets like Bromont reached record high appreciation, which explains why prices have stabilized this year, to the benefit of other, more affordable areas a bit farther away, like Orford. In the condo market, demand for rental assets has contributed to price growth in recent years in Orford, due to the potential for additional income from short-term rentals, as well as strong resale value.”
Elsewhere in the province, the median price of a single-family detached home in Mont Saint-Sauveur increased 19.7% year-over-year to $562,500, compared to the same period in 2021, while the median price of a condominium rose 22.4% year-over-year to $382,300. During the same period, the median price of a single-family detached home in Val Saint-Côme and Mont Garceau increased 17.9% year-over-year to $435,000. In the Quebec City area, the median price of a single-family detached home near the ski slopes in Stoneham and Lac-Beauport increased 15.9% year-over-year to $475,300, compared to the same period in 2021. In Mont Sainte-Anne, the median price of a single-family detached home rose 4.1% year-over-year to $286,200, compared to the same period in 2021, while the median price of a condominium in the region rose 16.0% year-over-year to $145,000.
Royal LePage is forecasting that the median price of a single-family detached home in Quebec’s popular ski regions will decline 7.0% over the next 12 months, to $454,398. The forecast is based on the expectation that this market segment will show a sharper decline in prices in 2023, compared with the province’s urban markets. Given that resort markets have experienced the highest price increases over the past two years, Royal LePage anticipates that they will be the most significantly affected by price corrections. A slow but steady increase in supply in this segment is also projected, as some owners attempt to offset their expenses by putting their cottages and secondary residences on the market.