Saint John housing market to favour sellers in 2021, prices expected to rise 5%
The Saint John housing market is expected to continue to favour seller in 2021, with prices continuing on an upward trajectory. The region saw average residential price rise to $202,195 in 2020 (Jan. 1-Oct. 31) up from $185,430 in 2019 (Jan. 1-Dec. 31). Looking ahead to 2021, the RE/MAX outlook for Saint John real estate is an increase of 5% in average priceto approximately $212,304 across all property types.
Saint John currently has about five to six months of resale housing inventory. Home sales in 2021 are estimated to increase slightly compared to 2020 levels, as homebuyers continue to take advantage of current record-low interest rates and no increases expected in the near future. The new construction market is strong in the region, however the number of new homes being built is still not sufficient to meet overall demand. New-home prices are also expected to rise, reflecting the increase in overall building costs.
Market activity in 2021 will be driven strongly by move-up buyers, with single-detached homes being in highest demand. Quispamsis, Rothesay and Milligeville are all projected to be the most in-demand neighbourhoods next year. When it comes to Saint John’s luxury property segment, COVID-19 had no impact on market activity, with move-up buyers and retirees continuing to drive demand for high-end properties.
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:
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.”
The Saint John housing market experienced a decline in sales activity at the onset of the COVID-19 lockdowns in mid-March, however home sales quickly resumed in the second week of April. According to the RE/MAX Fall Market Outlook Report, sales activity is still going strong in the region and is expected to continue into the fall market. Prices have continued to climb and are anticipated to increase 7% through the remainder of 2020, due to lack of inventory, pent-up demand and high cost of building materials all impacting the bottom line.
Recreational markets within Saint John, such as Rothesay and Kingston, have experienced normal levels of activity that are common throughout the summer months. Waterfront properties in these regions have always been in demand from local buyers, this interest is expected to remain the same, even during the pandemic.
Atlantic Real Estate Market Trends
Other Atlantic Canada regions that reported low case counts of COVID-19, such as Halifax and Charlottetown, also experienced reduced market activity in March, however these Atlantic housing market declines were less pronounced than those experienced by some Ontario and Western Canada regions. Activity here returned to pre-COVID-19 levels by May 2020, and like many sellers’ markets in Canada, multiple offer scenarios continue to take place.
Leading indicators from RE/MAX brokers and agents across Canada’s housing market point to a strong market for the remainder of 2020. According to the RE/MAX Fall Market Outlook Report, RE/MAX brokers suggest that the average residential sale price in Canada could increase by 4.6% during the remainder of the year. This is compared to the 3.7% increase that was predicted in late 2019.
The pandemic has prompted many Canadians to reassess their living situations. According to a survey conducted by Leger on behalf of RE/MAX Canada, 32% of Canadians no longer want to live in large urban centres, and instead would opt for rural or suburban communities. This trend is stronger among Canadians under the age of 55 than those in the 55+ age group. Not only are Canadians more motivated to leave cities, but changes in work and life dynamics have also shifted their needs and wants for their homes. According to the survey, 44% of Canadians would like a home with more space for personal amenities, such as a pool, balcony or a large yard.
Canadians equally split on their confidence in the housing market
Canadians are almost equally split in their confidence in Canada’s real estate market, with 39% as confident as they were prior to the pandemic, and 37% slightly less confident. When it comes to the prospect of a second wave of COVID-19, 56% of Canadians who are feeling confident in Canada’s real estate market are still likely to buy or sell. “The classically hot spring market that was pushed to the summer months due to the COVID-19 pandemic created a surprisingly strong market across Canada and across all market segments,” says Christopher Alexander, Executive Vice President and Regional Director, RE/MAX of Ontario-Atlantic Canada. “Looking ahead, government financial aid programs may be coming to an end in September, which could potentially impact future activity; however, the pent-up demand and low inventory dynamic may keep prices steady and bolster activity for the remainder of 2020. Overall, we are very confident in the long-term durability of the market.”Additional highlights from the 2020 RE/MAX Fall Market Outlook Report Survey:
48% of Canadians would like to live closer to green spaces
48% of Canadians say it’s more important than ever to live in a community close to hospitals and clinics
33% of Canadians would like more square footage in their home and have realized they need more space
44% of Canadians want a home with more outdoor space and personal amenities (i.e. balcony, pool etc.)
About the 2020 RE/MAX Fall Market Outlook Report The 2020 RE/MAX Fall Market Outlook Report includes data and insights supplied by RE/MAX brokerages. RE/MAX brokers and agents are surveyed on market activity and local developments.
Balanced market conditions expected for 2020, prices to increase 4%
RE/MAX is predicting balanced conditions for the Saint John housing market in 2020, with average price expected to increase by four per cent next year, thanks to a healthy and steady housing market. Sales prices will continue to increase at a reasonable rate, and market balance should continue, provided that housing inventory continues to be available in 2020.
Affordability is not a concern in Saint John, which is not the case for many of Canada’s housing markets. As a result, more buyers than ever are flocking to the region, attracted by its affordability and liveability factors. This is anticipated to prevail in 2020. Move-up, foreign, first-time and move-over buyers are expected to continue to propel the Saint John housing market next year.
The neighbourhoods of Rothesay, Quispamsis, Millidgeville are especially popular and ones to watch in 2020, in high demand thanks to their proximity to community services like the hospital.
From a national perspective, RE/MAX anticipates a leveling out of the highs and lows that characterized the Canadian housing market in 2019, particularly in Vancouver and Toronto, as we move into 2020. Healthy price increases are expected, with an estimated 3.7-per-cent increase in the average national residential sales price, according to the RE/MAX 2020 Housing Market Outlook Report.
In Atlantic Canada, Halifax and Saint John have experienced solid price appreciation of six and five per cent, respectively. Affordability continues to attract many buyers in the region, most of whom are buying single-detached homes. At the same time, the region’s condominium market is being driven by retirees. Conversely, the market in St. John’s is expected to recover in 2020, with increased consumer confidence expected to stabilize the market. However, the city’s aging population and high rate of outbound migration is expected to have an impact on housing market activity at some point.
Lydia McNutt is an award-winning editor, with more than two decades of experience specializing in Canadian real estate. At RE/MAX, Lydia is responsible for developing consumer-facing content while promoting the RE/MAX brand through housing market reports and market news, as featured on the RE/MAX Canada blog and social media channels. Lydia has been published nationally on topics ranging from real estate, architecture, decor and design, to finance, business, technology, entertainment and lifestyle. When she’s not head-down at her writing desk, Lydia is busy “momming” in Oakville, Ontario, where she lives with her husband, two kids and their chocolate lab, Betty. Email Lydia at firstname.lastname@example.org