Inclement weather had a significant impact on home-buying activity in Deer Lake and Corner Brook, with home sales down in the region in the first quarter of 2019.
Overall, Atlantic Canada is poised for strong housing market performance in 2019 as economic performance ramps up, unemployment rates decline, and first-time buyer incentives at both provincial and federal government levels take hold, according to the RE/MAX 2019 Atlantic Canada Housing Market Report. The report found strong momentum in the larger urban centres, as well as spillover into several smaller markets. Home sales are on par or up in just under half the markets surveyed (7/15), likely due to the current shortage of inventory, while housing values have climbed in almost three-quarters (11/15) of the Atlantic Canadian markets surveyed.
Housing Activity in Deer Lake & Corner Brook
Just 42 properties changed hands in the first three months of the year, down from 66 sales during the same period one year earlier. While activity has picked up in early April, most sales are occurring at lower price points, typically between $100,000 and $150,000. The OSFI stress test introduced in 2017 by the federal government has prompted many buyers in the area to adjust their expectations. Home-buying activity at higher price points has slowed, including the move-up market priced between $350,000 to $450,000 and the luxury market at $450,000 plus.
While the exodus of oil patch workers from Alberta continues to fuel steady home-buying activity in the area, with many former Newfoundlanders returning home flush with cash from the sale of properties in Calgary, Edmonton and Ft. McMurray, their numbers are dwindling. Buyer’s market conditions are helping first time buyers enter the market. Representing approximately 30 per cent of total sales in Deer Lake and Corner Brook, this segment should gain momentum in coming months. Website activity has also picked up, with more buyers from Halifax, Ontario and Alberta looking at available product on line.
Expansion in Deer Lake and neighbouring Pasadena is drawing buyers to newer home construction in the area. A large commercial development, including a small hotel, gas station and major food chain, is expected to create 150 jobs over the next 12 months, which should help to bolster the local economy. By year-end 2019, the number of homes sold in Deer Lake and Corner Brook is expected to be on par with healthy levels reported in 2018, while prices should hold steady in and around $190,000.
Atlantic Canada Housing Market Highlights
- First-time buyers were a driving force in almost 70 per cent of markets surveyed. (10/15)
- Low inventory levels were reported in 80 per cent of markets. (12/15)
- Home sales were strongest at starter price points ranging from $100,000 to $300,000.
- Buyers from other parts of the country were active in 60 per cent of Atlantic Canada housing markets. (9/15)
- Newfoundland and Labrador and New Brunswick are seeing an influx of people returning home after working in Alberta’s oil sector.
- Luxury sales were up in Halifax-Dartmouth, Saint John and Kings County.