MONCTON – In 2017, home sales in Greater Moncton increased 9.2 per cent from the year before, breaking a record for the region that was set a decade ago. The president of Greater Moncton REALTORS says there is no indication the growth will stop.
Jesus Machado said in an interview with Huddle that there was “tremendous momentum” heading into 2018 as the strongest activity happened at the end of last year. A recent city report that building permits broke records again also signalled things are going in the right direction.
“No one can tell what will happen for sure, but we use numbers to understand where this may be going,” said Machado. “There’s no indication that this trend is going to change anytime soon.
“The good thing about Moncton is [it’s not growing] fast like B.C. or Ontario. Here the growth is more sustained, more predictable and more consistent, and I like it that way because you can predict it better in a way.”
In December 2017, the value of all property sales reached $28.7 million, up 8.5 per cent from the same month in 2016. New listings dropped 21.5 per cent to 153 units compared to December 2016.
Meanwhile, more people moved in into the area from across Canada and abroad, Machado said.
“We know because we’re in contact with the city and organizations like 3plus Corporation that there’s more migration into the city,” he said. “The real estate properties are more affordable in Moncton than pretty much anywhere else in Canada. So there’s some influx of the people that, for example, have online businesses. They can operate [anywhere], they’re not attached to a location.
He said homes are much more affordable in Moncton, a plus for people coming in from a more expensive market.
“If you have someone living in B.C. or Ontario and they have a $1.2-million house, which is not a huge house, we’re talking about a decent, middle-class home, and they sell that, they can pretty much buy a house here a tier up and still have some pocket money.”
Prices are going up though, even though it’s still still less expensive to buy here.
As supply dropped and demand rose, home prices increased. The overall MLS Home Price Index (HPI) for Greater Moncton increased 6.3 per cent in December 2017 compared to the same month the year before. Semi-detached and single-detached homes, as well as apartments, increased in price.
Only townhouses saw a slight decrease in price by 1.5 per cent for that period. Compared to five years ago, the composite HPI benchmark for Greater Moncton shows a $14.72 per cent increase. There’s also less inventory in the market currently.
These changes are creating a more balanced market, Machado said.
“So it’s good for sellers, not as good for buyers,” he said. “A couple of years ago, we had a buyers market. Buyers had a lot of floor to negotiate. This is going to be a more balanced market.”
Machado said there’s currently a lot of investment and capital in Greater Moncton.
“On the commercial side, there’s a lot of construction. That creates also a lot of direct and indirect employment in the construction sector. And also, once those companies are operating, it will create further employment,” he said.
Greater Moncton’s location as a geographical hub is serving it well, and so does the affordability of real estate, Machado said. However, although he is seeing some urbanization, it’s still not comparable to larger cities. This is because the price of land remains cheap and the city’s core remains accessible with a short commute.
“We are not there yet, compared to bigger cities, when it comes to people moving to condo apartments in the core of the city,” he said. “However, we are seeing an increase in the number of people asking about that option.”