Halifax Real Estate Market | Year in Review
The real estate market became increasingly competitive throughout 2020. Inventory saw a persistent decline while sales quickened their pace. Historically low interest rates and a sub one percent vacancy rate in the Halifax area compounded the problem. Rent got more expensive while the cost to borrow money was lowest I’ve seen in my 14 year career. These factors had a significant effect on our single family statistics.
The Single Family Market
The average price of a single family home in the Halifax Regional Municipality increased by 14% in 2020. This represents an average increase of approximately 1.24% in a month, meaning a house worth $300,000 would gain $3,720 in 30 days. This is driven by a substantial drop in the number of homes for sale. We had 42% fewer homes available in 2020 while sales increased by 16%. Sellers in 2020 were obtaining on average, 100% of their asking price while the time it took to sell a home fell by 25%. This resulted in competitive scenarios where buyers were bidding against each other to secure a home.
The Halifax Condo Market
The single family market was hot, but the condo market wasn’t easy to navigate for home buyers either. The average price of a condo in HRM increased by 10% in 2020, representing a monthly increase of 0.8%. A condo worth $300,000 would gain $2,400 in 30 days. This is due to a 36.5% drop in inventory and 4% increase in sales. Condo sellers obtained on average, 99.5% of their asking price while the time it took to sell a unit fell by 35%. As the single family market continues to soar, condo living is becoming a more affordable alternative in some instances.
What's Next for our Real Estate Market?
In 2021, it is difficult to see why the trends we are currently seeing would change. Barring an unlikely influx of inventory, the problem of demand outstripping supply will persist. Builders can’t construct homes fast enough and buyers looking for a new home today, might have to wait eight or more months for completion. There are very few new condo buildings under construction as the vast majority of the units being added are rentals. The fear of selling a home with nothing to move into is another worry for those looking to upsize or downsize.
Once the COVID vaccine is widely distributed and travel restrictions begin to lift, it will be interesting to see if we see a further influx of people from across Canada or if the opposite will be true. However, given the last several months, I’m not sure why you’d want to leave Nova Scotia. Remote work also means that people from across the country in larger centers can work from anywhere. We have numerous clients from Ontario who are looking to cash in on their expensive Toronto homes to move to somewhere more affordable. Unfortunately, what is affordable to those in other areas of the country is unattainable for a lot of the local population. Price growth will continue, but whether it does so in a sustainable manner is an entirely different matter.
Need help making your next move?
We're here to help you navigate this incredibly challenging market - Get in touch with our team of professionals below. Our advice is free and we can discuss your specific situation to ensure you make the most of your next move. We help:
- Home Buyers (Even if you are brand new and have no idea where to start)
- People looking to sell to upgrade their home
- People looking to sell to downsize
- Those looking for investment properties
Posted by Chris Perkins on