ROGER TAYLOR BUSINESS COLUMNIST
The Chronicle Herald – January 16, 2016 Edition
Housing statistics for Nova Scotia are pretty dismal right now, which puts everyone in the real estate sector in an awkward position.
While nobody, especially those in the industry, wants to talk down the market, there is no denying that sales conditions could be better.
But veteran real estate agent Ed Power of Re/Max Nova says there is no point in trying to soft-pedal the numbers, as it only leads to disappointment for the homeowners.
Statistics show that sales are down, yet some people are saying home prices will continue to rise in 2016, which Power says is hard to justify.
Nevertheless, he says, ‟This is a buyers’ market, but that could be an advantage, especially if you want to move up (in value). This is the time to do it.” The Royal Bank released its monthly housing market update on Friday, using Canadian Real Estate Association numbers, which showed a small majority of local markets across Canada saw month-over-month decreases in resales in December, with Halifax, at -17 per cent, and Regina, at -11.1 per cent, recording the largest declines.
‟To put a positive spin on it, this is probably the best time in a decade to buy a house,” says another longtime Re/Max agent, Al Demings, who publishes his own bimonthly market update.
‟There is a good selection and prices have softened, that’s the bottom line,” Demings told me Friday, adding there’s also lots of mortgage money available at low rates.
That works, he says, for people buying their first home, or buying and selling within the same market, but it isn’t all roses because the oversupply of listings in the Halifax area has put downward pressure on home prices.
For those who don’t have to sell right away, Demings is recommending holding off listing their property for a little while, until things stabilize.
He said most of the new residential construction in the Halifax area is multiple-unit buildings.
Comparing 2015 on a yearly basis, the real estate association’s statistics show that resale of homes fell most steeply in Calgary at -20.8 per cent, Halifax at -15.1 per cent, Regina at -11.9 per cent, Edmonton at -6 per cent and Saskatoon at -4.1 per cent.
While the decline in activity in Western Canada is directly related to the sharp decline in the price of oil, Halifax’s predicament isn’t linked to a single industry.
Power says he believes the decline in real estate activity in Halifax is related to a significant drop in jobs.
He lists the closure of the Imperial Oil refinery in Dartmouth, the shutdown of BlackBerry ‘s operations in Bedford, rationalization at Bell Aliant after that company was taken over by BCE , the shutdown of the Convergys call centre in Dartmouth and government downsizing as key examples of lost employment in the city.
But the key to the change in the market here, says Power, has been a shift in policy by the Canadian military. The movement of military personnel every couple of years was an important aspect of the Halifax real estate sector because it meant homes were being bought and sold every year.
Today the number of military transfers are down significantly, he says, and that has resulted in a less active market.
The downturn in the stock market and general economic malaise that seems to be gripping parts of the Nova Scotia economy recently has some people emailing me with dire predictions about the national real estate market.
People have been making such prophecies about a real estate bubble bursting in places like Toronto and Vancouver for the past several years. So far, there haven’t been signs of a general economic meltdown that could lead to such an event.
If it was to happen, it probably wouldn’t have a direct impact on Halifax because any bubble that may have existed in the real estate market here has been deflated.
To put a positive spin on it, this is probably the best time in a decade to buy a house.
Al Demings Real estate agent