Known for some of the highest tides in the world, beautiful hiking trails, beaches and breathtaking coastal views, Canada’s East Coast has long been a desirable destination for those looking to escape the hustle and bustle of Central Canada, to experience a different view. With varying job opportunities and a diverse range of prospering industries, the East Coast offers a unique spin on life. The Nova Scotia housing market has become a hot spot.
Since the beginning of the pandemic about a year and a half ago, residents of Canada’s biggest urban centres have been showing more interest in the nation’s smaller coastal provinces, with the Nova Scotia housing market being a benefactor. With property prices rising to unaffordable levels in Ontario and British Columbia, some Canadians are taking risks and purchasing homes without even being able to visit the property beforehand; this practice would have been unfathomable pre-pandemic. Below, we take a look at the figures emerging out of the Nova Scotia housing market to better understand how out-of-province buyers are turning up the heat!
Non-East Coasters Taking Risks & Driving Up the Nova Scotia Real Estate Market
Canada’s East Coast, despite experiencing a surge in property prices, does not even come close to the average residential price of a home in provinces such as Ontario and British Columbia. This has led to many out-of-province buyers scooping up opportunities in the Nova Scotia real estate market with little to no investigation of the property being bought. This is intensifying the competition for homes in cities and towns across the eastern province.
For the better part of the last 18 months, home sales in Nova Scotia have been on the rise. The month of June 2021 saw 1,411 units change hands; while this is a decline of 6.6 per cent compared to the same month in 2020, it is well above historical averages for the month. In fact, residential home unit sales were 2.7 per cent above the five-year average and, more impressively, 15.3 per cent above the 10-year average for the month of June.
When tallying the residential home sales in Nova Scotia since the beginning of the year, a record has been set. Cumulative sales for the first half of 2021 have reached 8,407 units. Not only is this a record for year-to-date home sales for the province from January to June, but it is also a steep increase of 53.5 per cent compared to the same period in 2020.
This increase in home sales is being linked to out-of-province buyers flooding the market and pushing out local prospects in order to move to a less expensive part of the country. This stark surge in demand has inflated home prices across Nova Scotia. Come the end of June 2021, the average price of a home sold that month was $366,683 which is a jump of 27.6 per cent compared to the same period last year.
The year-to-date average price is comparable in regards to increase, as it was up 30.3 per cent compared to the first six months of 2020, coming in at $358,291. With home prices surging, buyers are looking to jump in on the market while it is hot. This has led to 2,165 new residential listings added to the market in June 2021 – a 21.8-per-cent increase compared to June 2020.
While new listings are increasing year-over-year, they won’t have a positive impact on market conditions unless they outpace demand. For Nova Scotia, this has not been happening. Active residential listings at the end of June 2021 were down 28.2 per cent when compared to June 2020, totalling just 3,136 units. While this may be the highest number of active listings in the last seven months, it is the fewest number in the month of June in more than 15 years.
With just 2.2 months of inventory left on-hand at the end of June 2021, the Nova Scotia real estate market is desperately in need of a surge of new listings and a decline in demand in order to balance this tight market.
What’s to Come for Nova Scotia Real Estate?
While vaccination levels are rising each day, many are hesitant to say that the COVID-19 public health crisis is behind us just yet. With real estate prices continuing to rise across Canada and restrictions remaining tight in many major markets like Quebec and Ontario, it is expected that more out-of-province buyers may continue driving up the East Coast market. Coupling this with low supply, it is expected that Nova Scotia property prices will continue to rise as 2021 draws to a close. Side-lined homebuyers may be waiting until 2022 for that highly anticipated market-cooling.
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