Shifting market: N.S. home sales down, prices up

The changing COVID-19 economy continues to have a significant impact on Nova Scotia home sales, but not necessarily prices.

February data from the Nova Scotia Association of Realtors says overall home sales are down 26.8 per cent compared to the year before, and new listings are down 14.7 per cent.

Benchmark prices, meanwhile, were up 3.1 per cent, likely driven, at least in part, by continued strong demand in markets like Halifax.

“In certain price points, [Halifax] is a very active and competitive market,” said Matt Dauphinee, the association’s president.

A Halifax realtor got a significant response on Twitter this week with an observation that a number of homes that were bought in 2021 were coming-up for sale again.

“Soooo many homes coming available this morning that were purchased in 2021,” read the tweet, although he later clarified it was far too early to call it a trend.

Dauphinee agrees with the assessment.

“Are there more reasons people might sell from that year than years prior to that? I could see that being a possibility,” Dauphinee said, citing a number of COVID-19-related factors, including lockdowns, border closures, quarantines, and even working from home.

“People that bought that year, their home values are up significantly, but in some cases, oil’s doubled in price, they may have moved out to a more remote area and being called to the office,” he said.

Data from the Nova Scotia Association of Realtors shows declining home sales in the province. (Courtesy: Nova Scotia Association of Realtors)

Others note there are other, broader factors at play.

"I think we're starting to see cracks in the Canadian economy,” said mortgage broker Clinton Wilkins.

After billions of dollars in COVID-19 relief, and stable interest rates, a shift is underway, he said.

"Obviously, part of that is due to what's going on with inflation. You and I see this when we go to the pumps, when we go to the grocery store,” said Wilkins.

After eight consecutive rate hikes in an attempt to tame inflation, the Bank of Canada is expected to press pause on Wednesday.

It’s meant a great many mortgage holders have been scrambling.

“I can certainly tell you there's a lot of consumers right now that are doing mortgage refinances and renewals,” said Wilkins, adding another trend he’s noticed is homeowners using the equity in their homes to improve their credit or upgrade the property itself.

"We certainly haven't seen the trend yet of people selling yet, very quickly after they bought. You know, if you bought in 2021, ‘22, you may have had some appreciation in the property value, but not enough to make sense if you were to sell it and incur those costs,” said Wilkins.

And while rising rates have doubtless been a market factor, they’re certainly not the final one, said Dauphinee.

“Mortgage rates will always impact price at the end of the day, but at the same time, everyone who’s looking for a home, needs a home,” he said.

“It may affect the price point they’re purchasing at, but the reality of them needing a home goes unchanged.”

And, although everyone likes to complain about the rate hikes, they remain a far cry from historic highs.

“If we look at where the rates have been over the last 25 years, we’re basically in about the ‘average’ zone,” he said.