Halifax Real Estate Market Crashing? Here’s What You Need To Know

Halifax Real Estate Market Crashing? Here’s What You Need To Know

 

Halifax Real Estate Market: Year-to-Date Stats and Real-Life Impacts on Home Buying and Selling

“What’s up with the Halifax real estate market? Now, that’s a tough question to answer in just a few short sentences. But in short, in 2022, the market has been crazy, interesting, and a lot of things. So today, I’m going to break that down for you. Year-to-date stats from January 1st to October 1st, 2022. And I’m not only going to talk about the statistics themselves, I’m going to talk about real life and how it’s affected the process of buying or selling a home in the Halifax real estate market. So, getting right into it, so far this year, we’ve had just over 4,500 sales in HRM, which is down 24.8 percent from this time last year. And these sales sold for an average of just over $545,000, which is actually still up over last year, 17.7 percent. The average time on the market this year for listings that are selling is about 15 days, which is actually down eight days from this time last year.

 

Halifax Real Estate Market Report: Fewer Buyers, More Inventory, Higher Prices in 2022

So, in short, to sum all that info up for you, in 2022, we’re selling fewer houses for more money in a quicker time frame than we were in 2021. Now, I’m going to break this down even further.I’m going to talk a little bit more about stats, which I think really tell the tale of what has been happening here in Halifax this year. Right now, we have about 834 homes for sale in the HRM, and that equates to about 2.18 months of listing inventory. Now, if I look back to June, this is double what we had in June, and it’s about four times what we had in March. So, in other words, right now, there’s a lot more on the market for buyers to look at.I would also say that based on my experience out there working day to day, there are a lot fewer buyers in the market. So, I think that’s a result of big interest rate hikes. We’re talking about the price points we were seeing kind of pushing some people out of the market as well. So, I think that’s a big reason why we have a lot fewer buyers.

 

Real Estate Prices See Significant Drop in Third Quarter

And now, the few buyers that we do have left that are active and serious, have a lot more to look at than they did in June or back in the spring. The biggest gap that I see that I feel is really important for people to understand and know is the difference between the price point average in the first quarter this year versus the third quarter last year. So, in the first quarter, we had an average price point of about $578,000. In the third quarter, this came down to about $488,000. So, a $90,000 difference, which equates to about a 15 percent price drop since the first quarter this year. Now, at the end of 2021 in December, we were averaging right around $460,000 on average at that time. So, right now, we’re starting to creep down toward that number that we ended the year for 2021 at. And if I’m looking at price per square foot, this has also dropped quite a bit from the peak in March/April to now in September.

 

Real Estate Market in HRM Experiences Significant Drop in Price per Square Foot, But Long-Term Holders Need Not Worry.

So, in March and April, the average price per square foot in HRM was about $423 per square foot. And now, that’s dropped to about $343 per square foot in September. So, again, that has dropped off quite a bit as well. Now, if you bought a home in April at the peak of the market, should you be worried? My answer to that really depends. It depends on what you’re long-term plans are. So, if you’re trying to sell right now, obviously, that’s going to create some problems for you financially. But the reality is, if you’re holding this place for three to five years, like most people are in real estate, or longer, I really don’t think you’re going to be worried about it. So, you know, the reality is the market has come back to reality quite a bit this year since the peak. But if you’re not selling right now, who cares, right? It only matters when you’re going to sell.

 

Real Estate Market Analysis: Stabilizing Prices Indicate Equity Growth Potential for Homeowners

The full potential of that investment that you have bought in the peak in April or March, give or take, it’s really only going to be realized when you go to sell. So, you know, even if it sells for the same price you bought it for in five years from now, you still have a lot of equity built up in that home that you’ve paid down off the mortgage under that five-year period. Now, to give you some good news, if I’m looking at just September 2022 versus September 2021, the average price point is up year over year about seven percent. So, that’s a great sign in the grand scheme of things going forward. And on top of that, if I look at the price point in September at $517,000 on average, that’s actually up from July and August. So, July was about $500,000, and August was only $466,000. So, to me, that says that we might be stabilizing here and we’re coming down from the peak. But I think we’re getting close to the lower end of that scale of where this dip is going to take us.

 

Real Estate Market Trends: Decrease in Average Showings per Listing in 2022.

But again, only time will tell. So, moving on to another stat that I find quite interesting would be the number of showings on average per listing. So, in September 2022, there were an average of 5.7 showings per active listing, and that’s down over 50% from September 2021, which we were at about 11.8 showings per listing. Now, this makes sense. Back in September last year, the market was booming, rates were low, there were a ton of buyers, and there was very low inventory. So, we were seeing a ton of showings on our listings. And to put this into context, in January and February, we were at about 23 showings per active listing. And again, this makes sense. We had less than a month’s worth of inventory. The market was crazy.I know our listings at that time of year we’re getting about 30, 40, and sometimes even 50 or more showings every time a new listing hit the market. And there was actually a townhouse in Clayton Park that had over 125 viewings in less than five days back in January.

 

Real Estate Market Showing Signs of Stabilization After Record Highs in 2022

So, again, that was a crazy time in the market. It was a huge, huge peak. And really, we’ve been coming back to reality since then. Showings have tapered off tremendously since the peak. And the last stat that I’m going to talk about is sale to list price ratio. So, basically, this means what is it listed at and where is it selling? So, if it’s listed at $400,000 and it sells for $400,000, that would be a hundred percent of the sale list price ratio. So, this peaked in March 2022 at almost 125 percent of the list price. And in September 2022, we are at about 99.7 percent, so almost 100 percent, which is still fantastic. And this really isn’t surprising to me because the strategy of how you list a house and how you’re selling a home has totally changed since the peak at the height of the market. As most of you guys know, we were listing properties way under what we felt they were worth to create that bidding war and to create a frenzy and get multiple offers on our listing.

 

Real estate market shifts from underpricing to listing at or above market value.

So, in other words, at a certain point, most people were listing about $100,000 under what they felt the market value was. So, that sale-to-list price ratio is a little bit skewed in a way because it’s not really showing, you know, it wasn’t listed at that market value and sold 125 percent over top of that. It was listed way under market value and then sold for what it would be considered as a market value. But now, with everything slowing down, we’re not getting the multiple bids that we used to get. And most listings are listing kind of at market value or a little higher, almost like the old way that we used to see back when the market wasn’t so crazy. And now, you know, we’re seeing a lot of sales at full price or slightly under or maybe slightly over in some cases. And I know the $300,000 to $500,000 range is still very, very competitive. And sometimes we’re seeing multiple offers in those kinds of ranges.

 

Halifax Real Estate Market Sees Unprecedented Price Increases, Anticipates Down Year in 2023

But a lot of times, in the prices that are over $500,000 to a million or higher, we’re not seeing the multiple offers that we were six, eight, or 12 months ago. In the past 40-plus years we’ve never really had a drop like this, but we’ve also never had price increases like this either. In 2020, we were up about 14.8 percent year over year. In 2021, we are up 25.6 percent year over year, and now this year, we’re up almost 18 percent again year over year. To put this in context, since 1980 in the Halifax Dartmouth region, we’ve only had four years with double-digit price increases. From the years 1985 to 2002, we only had one double-digit price increase. So, again, we’ve never seen a drop like this, but we’ve definitely never seen price increases like this either. At this point, I am anticipating a down year in 2023, and then I think the market will start to stabilize and go on an upward trend again. Should you be worried? Not really, unless you’re selling in a very short time frame.

 

Navigating the Halifax Real Estate Market Amidst Uncertain Times: Insights and Advice

If you bought at the peak in April and are trying to sell now, that’s going to cause some problems. But if you bought in April and are not planning to sell for a few years, don’t worry about that yet. Only time will tell what will happen with the Halifax real estate market, but I do think that for the second time in 43 years, next year we will have a down year over year in terms of the average price point in Halifax. If you made it this far, I really hope this post helped put some context into all the media and articles you’re seeing out there about the market crashing or tanking. Well, it is coming back to reality, but I wouldn’t necessarily call it a crash just yet. We’re still up almost 18 percent as a whole on average since this time last year. But I really hope that this helped put this into context for you. If you have any questions at all, don’t hesitate to drop a comment below or book a call with me anytime.

 

Stay Up-to-Date with Halifax Real Estate Market Update – March 2023

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