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2022 halifax market

What does the 2022 Halifax market look like?

The 2022 Halifax market is going to be full of action, much like the past couple of years before it. This year, however, odds are high we will also be dealing with interest rate increases from the Bank of Canada. How will these changes impact real estate in Halifax and around Canada? Here’s everything you need to know.

2021 recap

2021 was a whirlwind year for real estate. We finished off the year with low interest rates and continually rising housing prices. In Atlantic Canada, we saw a big boom in people from provinces like Ontario who work remotely, relocating in favour of more affordable housing. This contributed to higher demand, and therefore, rising housing prices. Across Canada, interest rates remained low for variable-rate mortgages, while we saw some increases to fixed rates. The pace may have slowed down a bit, but sales activity still remained higher than normal as we left 2021. 

What to expect in 2022

What changes, if any, will 2022 bring to real estate in Atlantic Canada and the rest of the country? The situation varies from region to region, but there are likely to be some common trends across the nation. Here’s what we should expect to see in the 2022 Halifax market and the overall Canadian landscape.

Increase in interest rates

We heard a lot from the Bank of Canada in 2021 about their plans to increase interest rates in 2022. Most likely, we will see an increase to the overnight rate within the first half of the year, but we still don’t know exactly when, how much, or how many increases we will see in 2022. The bank has been purposely keeping rates low to protect the economy during COVID-19, making it easier to borrow so the economy will keep moving. As the economy has recovered, the only question remaining is when the bank will adjust their rates. When they do, it will become more expensive to borrow, which will impact some people’s ability to buy a home. It might slow down price increases a bit if demand drops off, including here in Halifax, but it likely won’t stop the market in its tracks. With things as intense as they have been, here’s what’s in store for housing prices, supply, and demand.

Housing prices

People are likely to keep moving from province to province this year, and Atlantic Canada will remain a desirable destination. According to RE/MAX, Halifax may experience residential sale price increases of up to 16 per cent in 2022. The real estate market remains a top investment choice for many Canadians, and areas that were popular in 2021 will continue to be so in 2022. Even if interest rates increase, it seems unlikely that they will rise enough to knock demand down a significant amount. RE/MAX supports this by estimating that 97 per cent of regions in Canada will stay in a seller’s market in 2022. The average housing price in Halifax will sit around $543,890.88 this year, up from $464,864 in 2021. It seems housing prices will continue to increase this year as a result of sheer demand.

Supply and demand

As we mentioned above, demand is likely to remain steady for housing this year. RE/MAX predicts a 3.5 per cent increase in the number of housing sales in Halifax, compared to 2021. Single-family detached homes and condos have seen the most demand as immigration to Atlantic Canada continues, both from inter-provincial migration and international movement. What will supply do in light of all this demand? While construction on new homes will continue to flourish, the supply shortage issues we saw last year with building materials may continue. This might reduce the supply of homes available to sell, which will also increase prices.

Have questions? Contact a broker!

Long story short, we should expect to see a fairly busy winter season here in Halifax. Prices will continue to increase due to demand, and the prospect of interest rate increases likely won’t damper these trends too much. Demand may outpace supply once again, with all signs pointing to a seller’s market. If you’re hoping to buy, get in touch with a broker to discuss your options. If you’re a current home owner, you could also see if you might benefit from a refinance! Accessing home equity could be a great move right now, but it’s important to get a broker’s eyes on your situation first.

If you have questions about buying a home or refinancing your mortgage, get in touch with us at Clinton Wilkins Mortgage Team! You can call us at (902) 482-2770 or contact us here.