Niagara housing market to favour sellers in 2021, prices expected to rise 12%
The Niagara housing market will likely continue to favour sellers in 2021, as a continuation of a busy market in 2020 driven by the migration of homebuyers from the Greater Toronto Area, Peel and Halton regions, prompting price growth in the region. The Niagara housing market saw average residential price rise to $533,198 in 2020 (Jan. 1-Oct. 31) compared to $449,410 in 2019 (Jan. 1-Dec. 31). Looking ahead, continued demand is expected put upward pressure on prices, with an expected increase of 12% in average price to $597,181 across all property types.
Who’s driving demand in the Niagara housing market?
Niagara has been experiencing an influx of out-of-town buyers attracted to larger homes and more space. This has been a common trend across many Canadian housing markets as well as regions abroad, as homebuyers seek more square footage and green space outside of urban areas in the wake of COVID-19. Factors impacting this broader trend include the rise in remote work, the desire for more space and less density, as well as lower housing prices.
Current market conditions are expected to continue in 2021 as more move-over buyers from larger cities outside the region continue to look for some of the typical attributes that come with a more suburban lifestyle, including the option to live in a single-detached home.
The top three neighbourhoods in Niagara based on 2020 sales include Crystal Beach/Ridgeway, Lincoln/Crowland and Lincoln Mall. This is a shift from pre-COVID conditions, when downtown St. Catharines was the most in-demand area in the greater region, but has since seen suburban neighbourhoods grow in popularity.
First-time homebuyers in the region are typical young couples in search of single-detached homes. Families make up the bulk of Niagara’s move-up market as well as the condo buyer segment in the region, along with retirees/downsizers, who are also frequently looking to purchase condo properties.
Meanwhile, Niagara’s luxury home market has remained relatively strong amidst COVID-19, which is expected to continue in 2021.
Canadian housing market in 2021
Canadians are on the move. RE/MAX isn’t calling this an “exodus,” but the re-location trend across the Canadian housing market is real, and it’s just one focus of the RE/MAX 2021 Housing Market Outlook Report. RE/MAX Canada anticipates healthy housing price growth at the national level, with move-up and move-over buyers continuing to drive activity in many regions across the Canadian housing market. An ongoing and widespread housing supply shortage is likely to continue, presenting challenges for homebuyers and putting upward pressure on prices.
Due to these factors, the 2021 RE/MAX 2021 outlook for average residential prices is an estimate of +4% to +6% nation-wide. Here’s the regional break-down:
Additional report findings include:
- 35% of RE/MAX brokers indicate that “move-over” buyers from other cities and provinces will continue to spark market activity in 2021
- 45% of RE/MAX brokers indicate that move-up buyers will likely be a primary driver of the housing market demand in 2021
- Half of Canadians (53%) are confident that Canada’s housing markets will remain steady in 2021
- 52% of Canadians believe real estate will remain one of the best investment options in 2021
“We’ve seen a lot of anecdotal evidence since the summer that households are considering significant lifestyle changes by relocating to less-dense cities and neighbourhoods,” says Christopher Alexander, Executive Vice President and Regional Director, RE/MAX of Ontario-Atlantic Canada. “This has sparked unprecedented sales this year in suburban and rural parts of Canada and we expect this trend to continue in 2021.”