Is the Canadian real estate market suffering a nationwide housing affordability crisis, or is it a regional one? While the Ontario housing industry is facing sky-high valuations and robust sales activity, the Saskatchewan real estate market has ostensibly achieved a delicate balance between affordability and appreciation. As a result, the province has become an appealing market for homebuyers and a decent one for sellers, too.
Indeed, Saskatchewan is currently a seller’s market, but this urban hub of the Prairies may be showing signs of slowing down, which would be welcome news for prospective homebuyers hoping to achieve the Canadian dream. Do October’s numbers support the inference that the Saskatchewan real estate market may be inching closer to balance?
Balance Returning to Real Estate Markets Across Saskatchewan
According to the Saskatchewan REALTORS® Association (SRA), residential sales fell 4.2 per cent year-over-year in October, totalling 1,306 units. Year-to-date, residential transactions climbed 26.4 per cent, suggesting that demand in the Saskatchewan real estate market might have reached its peak earlier in the year.
The total residential benchmark price advanced 4.6 per cent in October compared to the same time a year ago, coming in at $284,500.
Once again, the main issue in the province is supply. SRA data reveal that new residential listings declined 5.3 per cent from one year ago, just short of 2,000 units. Active residential listings were also down 10.5 per cent year-over-year, at less than 6,900 units.
Historically, new residential listings are more than 10 per cent below last year’s level, and nearly 20 per cent below long-term averages.
Months of inventory also fell 6.6 per cent, to 5.2 months. This number is also down 33 per cent from the 10-year average. This is an important metric for industry observers, because it measures the amount of time it would take to liquidate current inventories at the present rate of sales activity.
“Despite challenges with the pandemic, housing demand in the province has remained exceptionally strong as many purchasers are looking to take advantage of the very low lending rates,” said Chris Guérette, CEO of SRA, in a news release.
“One of the single greatest issues the Canadian real estate market faces, including in Saskatchewan, is the declining levels of housing supply,” he added. “The seasonally adjusted number of residential properties left for sale on MLS® Systems of Canadian real estate boards and associations is close to falling below the 100,000 mark for the first time on record. Six years ago, that number was a quarter of a million.”
However, new housing construction is on the rise across the province. Canada Mortgage and Housing Corporation (CMHC) data show that housing starts surged 265 per cent year-over-year, to 545 unit starts in September. In the first nine months of 2021, housing starts soared to just below 3,000, up from around 2,000 compared to the year-to-date basis in 2020.
A Look at the Regional Saskatchewan Housing Market
Here is a snapshot of the largest housing markets in Saskatchewan on an annualized basis. With the exception of Regina, the months of inventory within each of these local housing markets is slipping.
- Sales: -2% to 574
- Average Price: +5% to $355,770
- New Listings: -6% to 786
- Active Listings: -14% to 2,046
- Months of Inventory: -12% to 3.45
- Sales: -9% to 326
- Average Price: +7% to $326,770
- New Listings: +3% to 498
- Active Listings: +1% to 1,536
- Months of Inventory: +11% to 4.71
Moose Jaw Region
- Sales: +5% to 61
- Average Price: -10% to $188,420
- New Listings: +17% to 103
- Active Listings: -11% to 384
- Months of Inventory: -15% to 6.3
Prince Albert Region
- Sales: -6% to 68
- Average Price: -2% to $247,065
- New Listings: 0% at 102
- Active Listings: -19% to 420
- Months of Inventory: -14% to 6.18
- Sales: +9% to 105
- Average Price: +12% to $180,064
- New Listings: +2% to 132
- Active Listings: -18% to 670
- Months of Inventory: -25% to 6.38
What’s Next for the Saskatchewan Real Estate Market?
Although the Saskatchewan real estate market may be moderating, local experts suggest that more work needs to be done to ease the hot market, advocating for trilateral cooperation between the federal, provincial and municipal governments to address the housing supply crunch and restore housing affordability.
“To tackle the supply and affordability issues, all levels of government need to ensure adequate housing opportunities are available for Saskatchewanians across the housing spectrum,” stated Guérette. “We are recommending policies that address those issues, like including clauses in Infrastructure Bilateral Agreements with provincial and territorial partners to encourage and incentivize the creation of more housing supply and increased recruitment of immigrants to our province.”
Real estate leaders in other housing markets across Canada have echoed these sentiments. For the sake of hopeful homebuyers who have been sidelined over the past two years, Canada must prioritize an environment that fosters cooperation and collaboration.