N.B. Home Sales Remain Strong, Even As National Market Starts To Cool
FREDERICTON – Even with the Bank of Canada’s foot firmly placed on the interest hike pedal, New Brunswick home sales aren’t slowing down as much of the rest of the country appears to be.
New numbers this week by the Canadian Real Estate Association (CREA) show national home sales fell by 5.6 percent on a month-over-month basis in June.
With The Bank of Canada hiking its policy rate to 2.5 percent this month, the continued boost to the cost of borrowing is beginning to reflect a much-anticipated slowing for demand in the national housing market.
While home sales were down for nearly three-quarters of all local markets measured, and led by Canada’s biggest cities, home sales in New Brunswick still posted the second highest June reading on record.
The number of homes sold through the MLS System of real estate Boards in New Brunswick totalled 1,270 units in June, down just 3.7 percent from a record-setting June of last year.
From a more historical perspective, home sales in the province last month still remained 10.7 percent above the provincial five-year average, and a whopping 28.5 percent above the 10-year average for the calendar month.
On a year-to-date basis, home sales in New Brunswick have totaled 5,830 units through the first six months of 2022, in what CREA also noted was a substantial decrease of 12.8 percent from the pace measured from the same period last year.
The benchmark price for single-family homes in New Brunswick was $299,900, up 29.6 percent on a year-over-year basis in June.
By comparison, the benchmark price for townhouse/row units was $262,300, up 37.1 percent compared to a year earlier, while the benchmark apartment price was $272,900, up by 27.4 percent from 2021.
Bucking the national trend in NB
“Many other areas of the country are seeing declines in the number of reported sales, while our local market continues to buck the trend,” said Mike Power, President of the Greater Moncton REALTORS du Grand Moncton in a release on the local statistics earlier this month.
While the number of homes sold through the MLS System in the Greater Moncton area was down modestly by 3.1 percent from June of last year, Power says new listings continued to return to the market, helping overall inventory rise to the highest level since September 2020.
Even with sales activity keeping pace in the Moncton area, Power believes recent rate hikes will likely ease up the demand long term.
“Buyers that may have been putting off purchasing a home seem to have returned to the market now that there is a larger selection of homes available,” stated Power. “Moving forward, it is reasonable to expect sales to cool as interest rates rise and buyers wait to see what impact rising mortgage rates and declining prices have on the market in general.”
On a year-to-date basis, home sales in Moncton totaled 2,004 units over the first six months of the year, decreasing 15 percent from the same period in 2021.
Demand for homes in Saint John also remained very strong in June, and while the number of homes sold in the Port City on MLS totaled 325 units last month, it was still a three percent reduction from June of last year.
According to the Saint John Real Estate Board, home sales are still 18.8 percent above Saint John’s five-year average, and 38.4 percent above the 10-year average for the month of June.
“Although many other markets across the country have seen demand falter, market activity in our region continues to flourish,” said Kevin Donovan, President of the Saint John Real Estate Board.
Donovan adds last month’s numbers still equate to the second highest June total in history for Saint John.
“The number of newly listed properties last month was in line with what we would expect in a typical June, which helped to keep overall inventory stable,” stated Donovan.
Fredericton Area home sales came in around average for last month, with the number of homes sold through the MLS System of the Real Estate Board of the Fredericton Area Inc., declining 10.8 percent from last June.
While home sales in the capital were still 1.2 percent below the five-year average for June historically, Fredericton still saw the average price of homes sold in June 2022 rise to $310,331, a 17 percent increase over June of last year.
Slowdowns in Halifax
While prices are mostly continuing to rise in New Brunswick, things appear to have stalled in Halifax-Dartmouth, according to the latest numbers provided through CREA by the Nova Scotia Association of Realtors.
For June, home sales in the Halifax-Dartmouth market were down 6.1 per cent over the same month last year, though with 705 residential sales units, homes sold in the Halifax area still accounted for almost half of all homes sold in the province last month.
Average sale price for Halifax homes sold last month came in at $542,869, roughly 15 percent lower than last June’s red hot performance.
Homes in the Halifax area in June, on average, were still selling for roughly $122,000 more than elsewhere in the province.
Interest rates expected to slow sales further
“Sales activity continues to slow in the face of rising interest rates and uncertainty,” said CREA Chair, Jill Oudil on the release of its latest stats Monday, adding, “The cost of borrowing has overtaken supply as the dominant factor affecting housing markets at the moment, but the supply issue has not gone away.”
“While some people may choose to wait on the sidelines as the dust settles in the wake of recent rate hikes, others will still engage in the market in these challenging times,” she said on June’s housing performance.
Tyler Mclean is a Huddle reporter based in Fredericton. Send him your feedback and story ideas: [email protected].