The QFREB’s New Statistics and CREA’s Previous Statistics Are Not Directly Comparable

For several years now, efforts have been made in Québec to standardize the calculation of real estate market statistics and make them more rigorous. However, changes resulting from this process have affected date continuity.

In the past, Centris residential statistics were compiled by each of the province’s 12 real estate boards based on all transactions concluded by their members. The boards then forwarded their statistics to the Canadian Real Estate Association (CREA). Since the merging of the province’s different databases in 2008, the Québec Federation of Real Estate Boards (QFREB) has made some major adjustments to its residential real estate statistics. The two main changes concern geography and the calculation of average prices.

Geography

In the past, geographical areas associated with real estate data did not follow any specific boundaries or borders.

To start with, the territory covered by each real estate board did not correspond to any recognized geographic area. For example, the territory covered by the Greater Montréal Real Estate Board did not correspond to the administrative region of Montréal nor to the Montréal Metropolitan Area.

Secondly, members of the various real estate boards could conduct real estate transactions anywhere in the province. For instance, a member of La Mauricie Real Estate Board could sell a property in the Estrie area, and vice versa. When this happened, the property sold in Estrie would be included in the statistics for La Mauricie Real Estate Board.

Since the Centris provincial database came on line, we have chosen to use specific geographic areas that correspond to the borders of the province’s urban centres as defined by Statistics Canada. The statistics that are now being published by the QFREB correspond to the borders of the province’s six census metropolitan areas: Montréal, Québec City, Gatineau, Sherbrooke, Trois-Rivières and Saguenay. The same applies for the census agglomerations (e.g., Joliette, Drummondville, Val-d’Or, etc.)

Calculation of Average Prices

In the past, CREA had little choice but to calculate average residential prices by dividing the volume of sales by the number of transactions as provided to them by the local real estate boards.

The QFREB calculates average prices by property category and then produces a weighted average price for all residential transactions. In addition, some transactions are not used in calculating average prices if their sale price is unusually high or low when compared to the asking price.

Discontinuity in Chronological Data Series

For the two reasons described above, the previous statistics compiled by CREA and the new statistics produced by QFREB are not directly comparable. Most of CREA’s chronological data series for Québec regions began in 1980. They all ended in 2007. Most of the QFREB’s new chronological data series began in 2002. Analysts who are used to working with chronological data series should keep in mind that the previous series cannot be combined with the new series without serious discontinuity issues. To remedy the problem, we recommend comparing rates of change instead.