Montreal-area home sales declined by nearly 7% in May compared to the same period last year, as economic pressures continue to weigh on the housing market, the local real estate board reported on Thursday.
The Quebec Professional Association of Real Estate Brokers (QPAREB) said that a total of 4,200 residential sales were recorded in the Montreal census metropolitan area last month, down from 4,510 in May 2025.
Market Slowdown Across Property Types
The decrease was observed across all property categories. Single-family home sales fell by 6.5%, condominium sales dropped by 7.2%, and plex sales (buildings with two to five units) declined by 8.1%. The board noted that rising interest rates and ongoing inflationary pressures are making it more difficult for potential buyers to enter the market.
Prices Continue to Rise
Despite the drop in sales, prices continued to climb. The median price for a single-family home reached $580,000, up 4.5% year-over-year. Condominiums saw a median price of $395,000, a 3.9% increase, while plexes rose 5.2% to a median of $750,000.
“The market is clearly cooling, but prices remain elevated due to limited supply,” said Charles Brant, director of market analysis at QPAREB. “Sellers are still in a favorable position, but buyers are becoming more cautious.”
Inventory Levels Rise
Active listings in the Montreal area increased by 12% compared to May 2025, reaching 12,500 properties. This marks the highest inventory level for the month of May in five years. The number of months of inventory—a measure of supply relative to sales—stood at 3.0 months, up from 2.5 months a year earlier, indicating a more balanced market.
Economic Factors at Play
Economists attribute the slowdown to a combination of factors, including higher borrowing costs, persistent inflation, and uncertainty about the economic outlook. The Bank of Canada has maintained its key interest rate at 4.75%, the highest level in over two decades, which has increased mortgage rates and reduced affordability.
“The housing market is adjusting to the new reality of higher rates,” said economist Marie-Claude Gagnon. “We expect further moderation in sales activity in the coming months, but a sharp price correction is unlikely given the ongoing housing shortage.”
Regional Variations
Sales declined across most sectors of the Montreal region. The Island of Montreal saw a 6.8% drop, while the North Shore and South Shore experienced decreases of 7.1% and 6.9%, respectively. The Vaudreuil-Soulanges area was the only region to post a slight increase, with sales rising 1.2%.
The real estate board also reported that the average time to sell a property increased to 45 days, up from 38 days in May 2025, signaling that buyers are taking more time to make decisions.
Outlook
Looking ahead, Brant predicted that the market will continue to cool as long as interest rates remain high. “We may see further declines in sales volume, but prices are likely to stabilize rather than fall significantly,” he said. “The underlying demand remains strong, especially from first-time buyers, but they need more favorable conditions to act.”
The QPAREB data covers residential sales in the Montreal census metropolitan area, which includes the city of Montreal and surrounding municipalities.
