The Halifax housing market is showing more signs of moderation. But a historically low inventory continues to keep prices in the city high.
New data from the Teranet-National Bank House Price Index, released on September 20, shows out-of-control price increases in Halifax slowed for the fourth month in a row in August.
House prices are still going up in the city. They’re just going up slower and slower all the time.
Last month, the average home was only one percent more expensive than it was in July. For comparison, in May, the average price of a home rose by a whopping 4.3 percent compared to April.
“When you’ve been walking through a hurricane, 80-mile-an-hour winds all of a sudden seem like a welcome calm,” Honsberger said.
Take a look at longer-term trends and you can see what he means.
The average Halifax home has seen double-digit price increases, when compared to the same month the year before, for the last 16 months in a row.
In August of this year, the average home in Halifax was 32.4 percent more expensive than it was in August 2020.
Part of what’s happing, Honsberger says, is there are simply far too few homes on the market.
Because the supply of homes available to buy has been so low, everything that comes on the market gets snapped up almost immediately.
Supply is still incredibly low.
One of the ways the Nova Scotia Association Of Realtors tracks inventory is by looking at how long it would take to sell every single home on the market if no new ones were listed.
In August, there were 2.3 months of inventory in Nova Scotia. That was down from 2.8 in August of 2020 and way, way below the average for the province, which is 8.8 months.
Honsberger says the only reason the market is easing is that the number of people looking to buy has gone also down slightly.
With slightly less competition, buyers feel less pressure to make an offer immediately, or put in bids way higher than the asking price.
“So instead of 25 offers on some of these properties that are coming on the market… we’re only getting eight. But you know, you only need one for the listing to disappear,” he says.
Honsberger chalks the falling demand up to a couple of things.
He says the end of the strictest Covid-19 restrictions and the warm summer weather probably encouraged some people to put their house hunt on hold.
Nova Scotia has also been one of the safest places in the country to live during the pandemic. As other provinces start to get their own outbreaks under control, Honsberger guesses there are slightly fewer people looking to relocate here from the Greater Toronto Area.
But that doesn’t mean big-city money isn’t still flowing into Halifax real estate.
Ontario natives are still selling their Central Canada homes and moving to the East Coast where property is comparatively much cheaper.
“I’ve had 31 people referred to me from our Niagara Ontario office this year alone,” Honsberger says. “In my entire career, I probably would have gotten a total of 10 referrals from that office prior to this year.”
Honsberger says he also sees a fair number of international buyers snapping up homes in Nova Scotia, as well.
Nether they, nor inter-provincial immigrants, appear to be stopping any time soon. Honsberger says that means the market will likely remain heated for the near future.
He believes the only way things will slow down in a meaningful way is if governments take big steps to increase housing supply.
That means finding ways to issue more building permits, offering incentives to get homes built, and investing in more affordable housing.
***Trevor Nichols is a reporter with HuddleToday.ca. Huddle Today Limited and Acadia Broadcasting are each part of the Ocean Capital Group.
