Vacancy Rate for St. John’s, Mount Pearl and surrounding areas

December 15, 2008 · Filed Under First Time Buyers, St. John's Investments and St. John's Real Estate · Comment 

The vacancy rate within the St. John’s, Mount Pearl areas was lower in 2008 and average rents increased across the board. This marks the second consecutive decline in the vacancy rate and largely reflects the impact of brisk  economic activity and strong employment levels. Growth in residential construction activity, combined with record MLS® sales and a tight supply of existing homes for sale, translated into substantial price growth, making the transition from renting to home ownership challenging for renter households.

The vacancy rate for St. John’s and area was a low vacancy rate of 0.8 per cent. This represents a decrease
of 1.8 percentage points from the 2.6 per cent vacancy rate recorded in 2007 and marks the second time since 2003 in which the vacancy rate decreased.  At 0.8 per cent, the vacancy rate reached its lowest level since 1980.

Monthly rental rates increased slightly for St. John’s by 3.8%.  The average two bedroom rent currently stands are $630 monthly.

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Economic Funamentals supported record breaking St. John’s real estate

December 5, 2008 · Filed Under Market Trends, St. John's Investments and St. John's Real Estate · 3 Comments 

Good economic fundamentals have supported record breaking real estate activity in Newfoundland and Labrador in 2008. Despite concerns over the global economy that surfaced in October, home buyers continued to enter the real estate market en masse, bolstered by positive future prospects and Newfoundland’s new status as a ‘have’ province. While most other Canadian centres made the transition to buyer’s markets in 2008, conditions in St. John’s continued to favour the seller.  First-time and move-up buyers worked in tandem throughout the year, stimulating sales in virtually all price ranges. Homes priced in excess of $250,000 were particularly robust, up 78 per cent over levels reported in 2007. Tight inventory, heated demand, and in-migration have all been behind the push for housing in the provincial capital in recent years.

Residential home sales in the province are expected to post the only gain in the country by year-end, with the number of homes sold climbing a substantial 11 per cent to 4,950 units, up from 4,471 one year ago. Housing values are also forecast to experience a serious upswing in 2008, rising 21 per cent to $180,000, an increase of over $30,000 from 2007’s historic high.

The Williams effect on the overall economy—the pro business stance that has led to job security, declining unemployment levels, tax cuts and renewed confidence in Newfoundland and Labrador – has been nothing short of remarkable.  Capital projects contributing to the economic well-being of the province include Newfoundland LNG’s first natural gas trans-shipment and storage terminal near Grassy Point, valued at an estimated $1.5 billion; Vale Inco’s $2.17 billion plan to build a nickel processing plant in Long Harbour using hydromet technology—a more energy efficient, smelting method to extract nickel from Voisey’s Bay concentrated in Labrador; and the historic memorandum of understanding with the Innu Nation that will eventually lead to the development of the Lower Churchill hydroelectric mega project worth an estimated $6 billion.
Hebron will contribute $16 billion to the provincial economy over its 25-year life, and $7 billion for the Canadian economy. New home construction has also been brisk, with housing starts in the province expected to grow to 3,100 by year-end 2008 and taper back to more normal levels of activity in 2009.

With the provincial economy operating at full throttle, residential real estate in St. John’s is forecast to flourish.  Consumer confidence is expected to remain high throughout 2009.  Smart leadership and business opportunities should serve to attract even greater investment in the province.  Migration is forecast to climb as more and more jobs are created.  Seller’s market conditions should prevail in 2009, with vendors commanding larger deposits and builders asking and getting at least five per cent down for new construction.

The upper-end of the market should also thrive as higher wages translate into more expensive housing. About 4,700 homes are projected to change hands in 2009, down marginally over 2008 levels. Average price is expected to continue to climb, rising 12 per cent to $202,000 in 2009.

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St. John’s Newfoundland leads the charge for residential real estate in Canada for 2008

December 4, 2008 · Filed Under Real Estate Canada and St. John's Real Estate · Comment 

St. John’s, Newfoundland lead the charge for residential real estate in Canada in 2008, with an anticipated 11 per cent increase in unit sales over 2007, followed by Saint John, New Brunswick and Winnipeg.  Housing values are forecast to remain stable or climb in almost all markets in 2008, with the biggest gains expected in Regina (39 per cent), Saskatoon (24 per cent), Winnipeg (22 per cent), St. John’s (21 per cent), Saint John (19.5 per cent), Sudbury (14 per cent), and Montréal (12 per cent).

Housing market performance will clearly be contingent on economic performance at a local, provincial, and national level in 2009. Issues affecting the overall economy are impacting housing markets across the country and the situation is not expected to be remedied until consumer confi dence is restored. If inventory levels remain stable, pent-up demand kicks into gear, and lower interest rates stimulate home-buying activity, we could see a bounce back as early as spring.

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Threat of global recession hinders home sales in major Canadian housing markets in 2008 and 2009, says RE/MAX

December 3, 2008 · Filed Under Real Estate Canada and Remax Reports · Comment 

Mississauga, ON (December 3, 2008) – Global economic uncertainty weighed heavily on residential real estate activity in most major Canadian centres during the latter half of 2008. Although the forecast for 2009 promises more of the same, most markets are expected to weather the storm, says RE/MAX. “Housing market performance will clearly be contingent on economic performance at a local, provincial, and national level in 2009,” says Michael Polzler, Executive Vice President and Regional Director, RE/MAX Ontario-Atlantic Canada. “Issues affecting the overall economy are impacting housing markets across the country and the situation is not expected to be remedied until consumer confidence is restored. That said, we could see a bounce back as early as spring – if inventory levels remain stable, pent-up demand kicks into gear, and lower interest rates stimulate home-buying activity.”

Click here for the RE/MAX Press Release

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