The Nova Scotia real estate market report for March 2023 indicates that the number of new listings has increased significantly from February, which is typical as the spring market approaches. However, compared to March of last year, new listings are down 20% for Nova Scotia, 25% for Halifax, 32% for the Annapolis Valley, and only up slightly for the South Shore.
Regarding the number of homes sold, 662 homes had met all conditions but had not yet closed in March, which is down almost 50% from the previous year, but up slightly from February. The number of homes sold is down about 30% for the rest of Halifax, Dartmouth, Annapolis Valley, and the South Shore compared to March of last year, but only slightly higher than February.
DAYS ON MARKET
Days on market are relatively similar to March of last year but have decreased significantly from February, indicating increased competition in the market with multiple offers and offers over ask.
Overall, the median home sale price for Nova Scotia has increased significantly, currently sitting at $431,250, which is up about $15,000 from March of last year. For Halifax, the median home sale price has also increased from February to $489,635. However, the median home sale prices have slightly decreased for the Annapolis Valley and South Shore.
As of March 31, 2023, there are 2068 active listings for Nova Scotia, with 715 in Halifax, 361 in Annapolis Valley, and 307 on the South Shore. The Halifax market is experiencing multiple offers and holding offer situations again this year.
BANKS OF CANADA
Regarding the Bank of Canada’s next move, although the bank has paused interest rate increases, the banks are tightening credit availability, making it harder for those looking to buy to get approved for mortgages. The current 5-year fixed mortgage rate is 4.59%, while the 5-year variable is sitting at 5.50%.
IMPACT OF FEDERAL BUDGET
The federal budget release this week includes changes that could affect homeowners, such as the ability to renegotiate the amortization of variable rate mortgages. Additionally, the federal government is offering inflation relief to lower-income Canadians, which could increase inflation by putting pressure on the supply of goods. The banks will be watching, and this could affect whether or not they increase interest rates come April 12.
MOVING INTO SPRING MARKET
Going into the spring market, buyers and sellers alike need to recognize that what was experienced during COVID was the anomaly and not the norm. Sellers should expect home prices to not come back down to pre-pandemic levels, but they also won’t fetch the prices that homes were getting at the peak of the COVID buying spree. For buyers, mortgage rates of 1-2% were unimaginable for previous generations, while 4-6% mortgage rates were what the general populace was used to in the years leading up to COVID.
Recent polls suggest that inflation rates, rather than interest rates, are currently holding buyers back. Additionally, REALTORS® are often hearing hesitation from sellers to sell due to a lack of places to buy and uncertainty as to where to go once they sell.
The Nova Scotia government is offering incentives and rebates for current homeowners who are converting a space to provide living quarters to extended family members. Another option for homebuyers is to seek mortgage programs that allow for purchasing by non-matrimonial partnerships, such as groups of friends or family members looking to share a residence.
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