Saskatoon expecting to move from balanced market to seller’s market in early 2021, prices to increase 5%
Saskatoon real estate is currently considered balanced, but strong activity is anticipated to push it to a seller’s market in early 2021. Low interest rates will continue to drive market activity in the new year, and an uptick in demand for larger properties is expected to continue in 2021. The average sales price in Saskatoon increased by 5% to $346,239 in 2020 (Jan. 1 – Oct. 31), compared to $331,359 in 2019 (Jan. 1 – Dec. 31). The RE/MAX Outlook for Saskatoon real estate in 2021 is an increase of 5% in average price to approximately $363,550.95.
Move-up buyers are currently driving demand in the Saskatoon real estate market, which is expected to continue into 2021. The most popular property type with move-up buyers are single-detached homes.
First-time homebuyers in Saskatoon are typically young professionals looking for single-detached homes. These properties typically range in price from $275,000 to $330,000. Moving into 2021, it is expected to be easier for first-time homebuyers to enter the market, as interest rates are expected to be historically low. There has been no hesitation from first-time buyers entering the market, as they know it is a hot market.
Move-up buyers in the Saskatoon housing market are typically families with younger kids. Similarly to the first-time homebuyers, there has been very little hesitation from move-up buyers as they know the market is hot and interest rates are low. Limited supple and competitive offers have been some of the difficulties that move-up buyers have faced when looking to purchase a home in 2020.
The condominium market in Saskatoon is most popular with single homebuyers, with the average condo price in Saskatoon being $248,231. An increase in sale prices for condominiums has been a challenge for those looking to enter the condo market in Saskatoon.
Saskatoon’s luxury market is currently driven by move-up buyers, with the average starting price for a luxury home in Saskatoon being approximately $750,00. COVID-19 has had some impact on the luxury market in Saskatoon, as the market has seen an increased demand for luxury properties, with lower inventory.
Saskatoon’s Hottest Neighbourhoods
Saskatoon’s top-selling neighbourhoods in 2020 were Brighton, Stonebridge and Evergreen. These neighbourhoods are expected to continue to be popular in 2021. North End Saskatoon is also anticipated to be the in-demand neighbourhoods in 2021 due to the area’s proximity to industrial and manufacturing jobs.
Saskatoon New-Home Construction
The new-home construction market in Saskatoon is currently booming, with hardly any new-construction properties available. New-construction had been slow up until COVID-19; now whatever is available has been sold, with a lot of pre-sales taking place. New-home construction prices are higher than those of resale properties, and the current number of new-construction builds is just right in terms of meeting demand.
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
“Despite the tragic impacts of the pandemic, our optimism in the strength of Canada’s housing market has always remained,” says Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada. “While we’ve seen a significant shift in buyer preferences this year, we believe factors such as the supply issue, pent-up demand and historically lower interest rates will continue to fuel activity in 2021.”
With COVID-19 lockdowns beginning in March and April, the Saskatoon housing market lost what was typically a busy time of the year for the region. However, the second half of May saw a surge in activity. Saskatoon saw a lot of pent-up demand in June, resulting in the busiest June in years for the region.
Listing inventory has been low throughout the summer months, and a 3% increase in the average sale price is anticipated for the remainder of the year due to the low inventory. Steady activity is expected in Saskatoon, Saskatchewan for the fall market due to low-interest rates and high consumer confidence in the region.
Sales Were Up In May and June for Western Canada’s Housing Market
While COVID-19 lockdowns in March and April slowed down the housing market in Western Canada, transactions in Kelowna, Saskatoon and Vancouver resumed by May, with sales in both May and June surpassing year-over-year levels. Many buyers put their plans on hold at the peak of COVID-19 lockdowns, but they returned to the market quickly to make up for lost time.
Edmonton’s housing market quickly bounced back to pre-COVID levels in June, while Saskatoon experienced its busiest June in years; this momentum is anticipated to continue into the fall market, with RE/MAX brokers and agents estimating a three-per-cent increase in average residential sale prices for the remainder of the year.
Overall, brokers and agents in Western Canada say the potential buyers they are talking to are not too concerned with a potential second wave of COVID-19 impacting their real estate journey, and RE/MAX brokers are estimating steady activity to round out 2020.
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.
“While COVID-19 lockdowns slowed Canada’s housing market at the start of a typically busy spring market, activity bounced back by early summer in many regions, including Vancouver and Toronto,” says Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada. “Despite the tragic impacts of the pandemic, our optimism in the strength of Canada’s housing market has always remained, and current market activity further exemplifies this. Many homebuyers are now exploring different neighbourhoods that better suit their new lifestyles, and real estate agents are getting busier and working more with buyers from different major cities. According to our brokers and agents across the RE/MAX network, Canada’s fall market is expected to see spring market-like activity.”
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.
The Saskatoon housing market is currently experiencing a buyer’s market. The RE/MAX average residential sale price expectation for Saskatoon in 2020 will remain flat at zero per cent. There are currently 8 months of inventory available.
New Canadian’s and high net-worth individuals, including new to Canada buyers drove the Saskatoon housing market in 2019, and are expected to continue to drive the market in 2020. The number of units sold may increase slightly and will keep prices at zero per cent to low single digits year over year. Entry level luxury ($700-$750k) may see a slight decrease due to higher than average listing inventories.
The most popular property type overall is a single, detached house. First-time buyers prefer two bedroom condos and entry level detached homes, while the most popular type of condo is a two bedroom apartment style.
The new development of Brighton on the city’s North East side will be very popular in 2020.
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.
As more Canadians have adjusted to the mortgage stress test and older Millennials move into their peak earning years, it is anticipated that they will drive the market in 2020, particularly single Millennials and young couples. A recent Leger survey conducted by RE/MAX found that more than half (51 per cent) of Canadians are considering buying a property in the next five years, especially those under the age of 45.
RE/MAX of Western Canada
Kayley Jackson is an English & Creative Writing graduate, as well as writer and photographer whose love for words and creativity brought her to RE/MAX. As Communications Coordinator at RE/MAX of Western Canada, Kayley creates and oversees content that appeals to buyers and sellers alike, aiming to assist them on their homebuying or selling journey. Kayley carries out public relations, communications and social media content for RE/MAX, which includes creating content and writing for the consumer-facing blog at remax.ca. When she’s not behind the lens of her camera or writing away at her desk, Kayley can be found enjoying the Okanagan lifestyle in Kelowna, BC, where she lives with her fiancé, or daydreaming about where her next travel adventure will take her. Email Kayley at firstname.lastname@example.org.