Sask. home prices hit record in April, while average Canadian price dropped
The home-buying frenzy of the pandemic is showing some signs of slowing, with the number of home sales in Saskatchewan dropping last month by almost 17 per cent compared to the record set in April of last year, according to the Saskatchewan Realtors Association.
However, housing prices are up, as Saskatchewan's average price reached a new monthly high last month, according to the association's market statistics for April 2022.
Prices have been trending upward over the past two years, the association said, and the residential benchmark price for the province climbed to $295,000 last month — two per cent higher than March's benchmark and four per cent gain higher than a year earlier.
"We are still seeing prices increase year-over-year," said Chris Guérette, CEO of the Saskatchewan Realtors Association.
"We see a variety of different prices throughout the province, but in all regions except two, the benchmark price has gone up."
At the national level, Canadian average home prices fell six per cent in April from the month before, to $746,000.
The national average price is heavily influenced by sales in Greater Vancouver and the Greater Toronto Area, two of Canada's most expensive housing markets, the Canadian Real Estate Association said on Monday.
"Places where you're talking about buying a half duplex for $2.5 million … need some correction," said Ashley Turner, a realtor with Century 21 in Saskatoon.
"And that's going to happen with … interest rates going up, the government trying to cool off those housing markets."
For people in Saskatchewan trying to make a decision about a home, Guérette recommends buyers and sellers to look at the local market rather than the national one.
'Supply is not meeting demand'
Both Turner and Guérette agree that Saskatoon and other parts of the province have a major shortage of listings.
On Tuesday, the Saskatchewan Housing Continuum Network — a new housing advocacy association — projected a deficit of 100,000 housing units, based on expected population growth over the next eight years.
Inventory — also called active listings — was almost 20 per cent lower last month than in April 2021 and over 30 per cent below long-term trends, according to the Saskatchewan Realtors Association.
"We've been fortunate in Saskatchewan that we haven't seen some very large increases in housing prices that you see, such as in cities in Vancouver and Toronto," said Guérette.
"But at the same time, when we take a look at the past three years and the numbers are always creeping up and inventory is always falling, then that to me is an indication that supply is not meeting demand."
Turner is seeing that demand in Saskatoon.
About 1,500 to 1,600 listings would be a balanced market for Saskatoon — including houses and condos, she said.
In April, though, there were 1,053 properties available for purchase in Saskatoon — a year-over-year drop of more than 27 per cent, according to the realtors association.
"We're sitting at about two months worth of inventory for the entire city of Saskatoon, which is one of the tightest, actually, for inventory in the country for major cities," said Turner.
"We are seeing … people that want to buy, but you have six people that want to buy the same house. That's going to bring those numbers down for sales, when inventory is just not available."
In Saskatoon, the average residential home price rose to $338,500 in April — a new high for the city — while Regina's average climbed to $271,100, the realtors association says.
Higher interest rates might lead some potential buyers to pause their search or look at lower-priced homes, such as condos, said Turner.
"We don't want it to get to a point where the inventory is so low that we start seeing a very clear rapid erosion of affordability," said Guérette.
"I would hate for individuals to think that because sales are down, that we are not feeling the crunch anymore."