Saguenay Real Estate Market: 2024, A Year of Growth and Promise

In 2024, the Saguenay real estate market is at a pivotal stage. While several regions in Quebec are feeling the impact of economic uncertainty, Saguenay is emerging as a dynamic zone, with promising signs of sustained growth and fruitful investment opportunities. By analyzing the residential, commercial, and industrial sectors, as well as mortgage trends, we observe that the region is on track to establish itself as an expanding market.

1. Multifamily Real Estate: Stability and Growth Prospects

The multifamily housing sector in Saguenay presents a combination of stability and gradual growth. In 2024, despite a slight variation in costs per unit, the market is showing signs of long-term resilience and attractiveness:

5 to 11 Units :

The price per unit increased by a modest 1% between 2023 and 2024, reaching $77,000. This stability is encouraging for investors seeking secure appreciation, with steady rent growth. The overall capitalization rate (CAP rate) slightly increased from 4.8% to 5.0%, indicating a healthy balance between return and risk, but more importantly, a rise in the profitability of real estate assets.

12 to 49 Units :

Although the average price per unit slightly decreased by 2%, the capitalization rate rose from 3.4% in 2023 to 5.8% in 2024, a remarkable increase of 69%. This change indicates strong rental demand, combined with high return potential for investors. Although the small sample size affects the statistical reading, this indicator is crucial and demonstrates the continued appeal of larger portfolios.

These trends reveal a solid future for residential real estate in Saguenay, with growing rental demand supported by rising rents in several segments. Studios, for example, saw their average rent increase by 2.7%, while 3 ½ and 4 ½ apartments recorded respective increases of 9.3% and 8.1%. This rent growth, coupled with falling mortgage rates, means that investors will enjoy even more attractive rental returns in the coming months.

2. Mortgage Rate Dynamics and Its Impact on Economic Value

One of the most important trends shaping the real estate market in 2024 is the gradual decline in mortgage rates. This shift, after successive hikes to combat inflation, has a direct and positive effect on investment capacity and property acquisition. As rates decrease, accessibility to the market by buyers and investors rises, driving demand and increasing property market values.

This trend will not only support property value growth in Saguenay but also attract outside investors. Stable income-generating properties, combined with more favorable financing conditions, make Saguenay a prime region for those seeking to diversify their real estate portfolio while benefiting from a growing market.

3. Commercial Real Estate: Impressive Transaction Growth

The commercial real estate market is experiencing a true revival in the Saguenay region. The numbers speak for themselves:

Commercial transactions: The volume of transactions in the commercial sector soared from $20M in 2023 to $46M in July 2024. This increase in investment volume illustrates strong economic confidence in the region. Simultaneously, the price per square foot for commercial properties rose from $149 to $162.

This dynamic is fueled by regional economic development, infrastructure expansion, and growing interest in emerging areas where business opportunities are numerous. Moreover, local and provincial companies are looking to capitalize on lower operating costs in regions like Saguenay, compared to major urban centers.

4. Industrial Growth: Increased Development Potential

The industrial market in Saguenay is following a similar growth trajectory:

Industrial transactions: Transaction volume increased from $7M in 2023 to $9M in July 2024, reflecting increased demand for industrial spaces in a region where industry and logistics are becoming increasingly important.

The price per square foot, meanwhile, slightly increased from $134 to $136. This modest increase, coupled with the rise in transaction volume, demonstrates a growing market. Many industrial companies are seeking to establish themselves in the Saguenay region, attracted by competitive installation costs and a skilled workforce.

5. Office Market: An Opportunity to Seize

Although the office sector experienced a slight decline in transaction volume, from $20M in 2023 to $17M in 2024, the price per square foot rebounded, increasing from $136 to $159. This recovery in prices shows that despite challenges, the office market remains attractive for investors seeking opportunities in an evolving segment.

With falling mortgage rates, new businesses and startups will turn to more affordable office spaces in regions like Saguenay, where costs are lower than in major centers, but where growth potential remains high.

6. A Promising Future for Saguenay

Saguenay is positioning itself as an increasingly coveted real estate market, with a promising future. The return of falling mortgage rates enhances the region’s attractiveness by making financing more accessible, which, in turn, increases demand and property values. Rising rents in the residential sector, coupled with a growing commercial and industrial market, signal that the region is undergoing significant economic expansion.

Investors, both local and external, should consider capitalizing on this positive dynamic. Saguenay offers a rare combination of stability, attractive returns, and long-term growth opportunities. With financial accessibility reinforced by favorable mortgage conditions, 2024 could be a key year for this transforming region.