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