Saskatoon a Shining Light in Western Property Market

Photo: Flickr / Kyla Duhamel

In recent years, there has been relatively lacklustre performance in regards to real estate sales volume and prices in the Canadian West compared to markets in Ontario and British Columbia. Despite the weakened economic situation in the Prairies, the small city of Saskatoon in Saskatchewan has presented itself as a shining light in a region of where home prices and sales volume has actually contracted in the last few years. According to a report published by the Real Estate Investment Network, the organization has high hopes for real estate sales trends for the city in the near future.

As an economist from the Conference Board of Canada suggested, Saskatoon is quickly leaving behind a period of economic recession that has gripped the city over the past few years as a result of lower oil prices. Oil, which has a strong tie to the local economy not just for Saskatchewan, but also for the provinces of Manitoba and Alberta, has recently been on the upswing thanks to increased demand from all over the world, especially the up and coming developing countries such as India and other states in South Asia. The Board’s report has suggested that the city can expect a growth rate of more than three and a half percent over the next year, which would then drop to two percent over the next few years.  Certainly, while those sorts of numbers may seem unimpressive or even lackluster, it is better than what has been happening further west, especially when looking at the paltry economic situation that has gripped Calgary and its surrounding areas.

A positive economic growth rate in Saskatoon translates to a positive outlook when it comes to real estate performance over the short term, as well as stable home prices over the long term. At the same time, there are a number of hurdles that local buyers will have to face when it comes to purchasing property in the city, most notably the newly expanded regulations by the federal government in regards to mortgage loans as well as an increased mortgage loan rate. Thanks to a recent increase of the overnight borrowing rate by the Bank of Canada, those looking for mortgages will have to pay a lot more compared to the last several years. However, perhaps one positive is that home prices in the city as well as the region are considered to be relatively affordable when compared with other markets all over the country, as the average price for a single-family home in Saskatoon is just over $346,000.

Published Date: Oct 08 2017