Downpayment Biggest Roadblock to Entry into Halifax Housing Market

While ownership levels in the Halifax housing market steadily declined between 2006 and 2021—falling from 64 per cent in 2006 to 58.6 per cent in 2021 according to StatCan Census Data—the uptick in interprovincial migration and immigration during the pandemic may have reversed the course of home ownership in the city, but that remains unknown until the release of the 2026 Census. Statistics Canada, meanwhile, reported that close to 57,000 new residents called Halifax “home” between July 2020 and July 2024, bringing the city’s population to 530,000.

Growth, while positive, has brought challenges. Affordability has been an on-going issue in the city, culminating with a 60-per-cent increase in values across the Halifax housing market between 2016 and 2021, bringing average price to $460,149. Strong interprovincial migration and immigration have further bolstered price appreciation during the pandemic, but home-buying activity was curtailed when the Bank of Canada started to hike interest rates.

First-time buyers have been most impacted by higher housing values and stringent lending policies, yet they remain the crucial domino needed to propel move-up buyers and downsizers. Many entry-level buyers can afford monthly mortgage payments, which are now comparable to rental rates, but the downpayment remains the largest roadblock to home ownership. The average price in the Halifax housing market currently hovers at $575,000.

Other factors have contributed to declining home-ownership levels over the past one and a half decades. Many developers continue to focus their energies on multi-unit rental accommodations rather than condominiums, given the negligible price differential between semi-detached or row housing and condominium units. Developers have been dealing with higher input costs from construction materials to labour costs, all of which are passed down to the consumer. The time is right for the municipality to revisit development costs on new construction, reduce red tape and fast-track approvals; Halifax has historically been slow to turnaround permit approvals in comparison to other municipalities across the country. The Halifax Partnership Dashboard shows housing starts (on a 12-month moving average) fell to 311 in December of 2024, down 149 units from year-ago levels.

At the federal level, the stress test certainly served its purpose during the pandemic but, given current market conditions, it may be prudent to relax rules that don’t require buyers to qualify at rates of eight or nine per cent. Longer amortization periods—to 35 or 40 years—should be on the table once again for first-time buyers as well, given that rental costs never end.

The Halifax housing market continues to be supported by a strong economic base, anchored by higher education, public service offices and travel and tourism. The city has also done a good job in attracting new business, including head offices and new hotel construction. Wages are pushing upward, with a good assortment of positions available from entry levels to C-suite. Inventory levels remain tight in the city, with seller’s market conditions prevailing. Pent-up demand exists, with sidelined buyers anxious to jump into the market. Although the outlook for the city remains bright, the home ownership rate in Halifax remains seven per cent below the national average. The Provincial Housing Needs Assessment Report, commissioned by the Nova Scotia governments, notes that affordability, income constraints, and challenges in saving a downpayment make the leap from renting to home ownership key factors that have impeded growth in home ownership to date. High provincial tax rates have also been an on-going contributor. The implementation of economic and policy levers would serve to ease the path to home ownership for a greater number of younger buyers, particularly in light of an anticipated supply shortfall in housing expected through to 2032.