It’s a new year and a new decade. Personally and professionally, 2019 brought highs and lows, but overall, it was a good year for me. My sales were great and I was thrilled to end the year on a personal high note, winning an ongoing and emotional legal case. As we say goodbye to 2019 and hello to the new roaring ‘20s, I thought we should take a look back and ahead at real estate trends.
2019 market in HRM By all accounts, 2019 was definitely a seller’s market. The inventory of houses for sale couldn’t keep up with the number of buyers, forcing them to compete for properties. The high demand drove selling prices up and increased the likelihood of sellers receiving multiple offers, a scenario that sellers love and buyers dread. For the first time, Nova Scotia real estate stats are not just showing the number of “houses sold” but also “houses sold over asking.” I can’t even compare this year’s data to previous years since we’ve never tracked it before! Overall, buyers were not in a great negotiating position and were best off agreeing with what buyers wanted to improve their chance of closing the deal. They also needed to be ready to deal with the possibility of multiple offers (for more info on that, check out my advice on handling multiple offers).
Properties also sold a lot faster than usual, almost two months faster than 2018. This meant that sellers had to know where they were going to go when their sale closed.
These trends applied to all types and sizes of properties. I even saw hard-to-sell properties (ones that had been on the market for a long time, expired listings, those that needed work or were stigmatized) finally close. I also noticed a definite increase in the demand for investment properties, meaning that houses were moving into the rental market.
Buyers from out of province
In terms of buyers, we saw all types, but most were from out of province. Buyers from Alberta who are leaving the oil and gas industry or escaping the non-resident taxes in Ontario and BC are able to get more bang for their buck here where they can get more house for a much more reasonable price. Another trend I noticed was in new graduates from out of province deciding to stay in Nova Scotia instead of returning home. This was really encouraging to see as we’ve experienced so much loss of the younger population base so hopefully this will continue and help reverse the “brain drain”. On a similar note, we also saw the highest rate of immigration last year, resulting in the fastest one-year population growth Nova Scotia has seen since 1972. New immigrants contributed to both housing sales and rentals, which, in turn, helped drive the interest in investment properties.
In terms of a forecast for 2020, I expect we’ll see a continuation of the trends we saw in 2019. I believe we are still at the bottom of the curve in terms of pricing so, in fact, I anticipate prices will continue to rise, inventory will continue to be low and sales time will decrease. In short, 2020 will again be the year of the seller.
Something else to note is that when there is uncertainty in other Canadian markets, the Nova Scotian market tends to see an upswing as Canadians look for affordable housing prices and good quality of life in a friendly, welcoming culture. Nova Scotians who found work outside the province may return home as industries like oil and gas downsize. And if immigration continues at the same rate as last year, we’ll have more people looking to rent or, in some cases, buy.
What does this mean for buyers?
If you know you are going to buy in the next few years and you’re able to swing it now, you may want to; waiting could mean that you’ll be looking at even higher prices. You may need to adjust what you’re looking for or willing to buy. Consider buying something that’s not quite right but can be renovated. You can likely get a fixer-upper at a better price knowing that the upgrades you put in over time will increase the resale value down the road.
Also consider buying an investment property. With some buyers left unable to compete for properties, they’ll be looking to rent. These are likely to be good quality tenants, people who will treat your house as their own.
If you can’t buy yet, start or continue to save. First-time buyers can look for a house to rent to test-drive neighbourhoods and get used to being an “almost homeowner”, both of which will give you more insight later into what you’ll want to buy.
What does this mean for sellers?
If you’re planning to sell in 2020, try to get your listing up by the end of February in time for the spring market peak in March-June (call me!). This is when buyers come out of their winter hibernation and when a lot of military postings happen. It’s also the perfect time to photograph a yard with less-than-perfect grass – who’ll notice?
I also encourage sellers whose listings expired or were not successful in selling in the past to consider coming back on the market. When I work with clients like this, we discuss any past feedback they received from potential buyers or their previous agent so that we can use it to our advantage, modify the listing as much as we can and close a sale. Sometimes all it takes is the right staging to make a huge difference.
For sellers thinking about whether or not to make improvements to their home before selling, my suggestion is to do the minor cosmetic work but to leave the big upgrades to the buyer. In a market like this, chances are it will sell as is and the buyer will be willing to take on the upgrade to make the home fit their vision.
So goodbye, 2019 and hello, 2020! Last year was an exciting one in the real estate industry and I’m excited to see what this year and decade brings. If 2020 is your year to buy or sell, I’d love to work with you to navigate this tricky market. From my family to yours, happy New Year!