Flips driving local resale market: agent

By MARC LALONDE

Marc.lalonde@transcontinental.ca

First-time home buyers are currently driving the West Island housing market, a local real-estate agent said in reaction to early 2007 statistics showing a six-per-cent jump in Montreal housing prices released by the Greater Montreal Real Estate Board last week.

"It really depends on the price of the home, and right now, West Island homes priced in the $200,000 range are selling well," Re/Max Cadibec agent Linda Boisclair said.

"Homes that are a bit more expensive, on average, are sitting on the market a little bit longer," she said.

Part of that phenomenon, Boisclair said, is the growing number of homeowners who buy a home in need of extensive renovations, fix it up and sell it at a profit, or 'flipping,' as house, often seen on television.

"A lot of these starter homes are being bought for renovation, and the people who do it are always talking about this TV show where they do it. They're very popular, and people like the idea," Boisclair said.

Another phenomenon that might be driving a lower demand for more expensive homes is increasing customization, where a homeowner renovates the home extensively in order to avoid having to go through the moving process, with an extension on the house or individual rooms, she said.

"There's a lot of customization. People tailor the homes to their needs and are willing to go through that. We're also seeing a more-educated buying public than ever before. They know the market, they see on the Internet what houses are selling for, and they don't want to just pay any price," she said.

GMREB vice-president Michel Beausejour said no matter what your intention with a home, real estate is always a pretty sound investment.

"We studied the last 40 years and there were only two instances where the market did not grow consistently, and that was a period in 1982 and a period in 1995-96, where overall economic conditions were also not growing consistently," he said, adding that West Island housing numbers are often a good barometer of the Montreal market as a whole, with average-price growth in Kirkland (6.6 per cent) and Pierrefonds/Roxboro (5.1 per cent) that mirrors Montreal's rate.

Beausejour said a strong housing market can be attributed to three factors: a low interest rate, which makes mortgages cheaper for borrowers, a strong job market and high consumer confidence

"Those are often the best indicators, and from that perspective, we should have good growth in the housing market for the next two to five years at least," he said.

For more information, visit the GMREB's website at www.notwithoutmyagent.com