3 Trends that Affected the Housing Market of 2020

1. Employment Rate

Nova Scotia is steadily experiencing job growth and decreasing unemployment. The greatest impact in the 25-24 and 25-44 demographics. The job growth has helped to diminish the outflow of population and to also retain immigrants. Nova Scotia has a higher than average seasonal workforce which does impact the overall unemployment rate.

The workforce tends to be older than the national average as well, so planning for future employment requirements the Federal and provincial governments have a focus on funding retraining programs and supports to the EI programs to helps workers move from seasonal to year-round work. The increases in secure, year-round employment increase the number of prospective home buyers being approved by lenders.

2. Immigration Rate

he Atlantic Immigration Pilot program has been extended until 2021 which has been a key factor to Nova Scotia’s first population increase seen in decades. The AIPP has options for fast-tracking high skills and intermediate skilled immigrants and a program for retaining international graduates.

https://coxandpalmerlaw.com/publication/atlantic-pilot-program-fast-track-to-east-coast-immigration/ Nova Scotia universities have long been known for acceptance and a welcoming atmosphere for international students, but in combination with the extended AIPP, has resulted in increase of 24% of international students enrolled this past year in Nova Scotia universities, putting a huge pressure on vacancy rates in the Halifax area.

Purchasing homes and multi-units by international students and their families has become a viable and profitable option for residency, especially in light of the vacancy rate dropping. https://movenovascotia.com/tips-for-non-residents-or-foreigners-buying-property-in-nova-scotia-and-canada/

3. Vacancy Rate

The CMHC Rental Housing Report that was just released found the vacancy rate in Halifax to be the lowest ever recorded at just 1%. Rental rates have increased by 3.6% over last year. Many feel the construction of new multi-dwelling units are not keeping pace with the demand even though there are currently 4000 construction projects underway in Halifax.

Even with an additional 1000 permits for multi-unit projects being granted in 2019 over the previous year, there were approximately 1000 fewer projects completed. Finding skilled tradespeople have greatly impacted construction companies’ abilities to take on more contracts. Over 200,000 baby boomers are expected to retire from the workforce over the next few years.

https://www.thechronicleherald.ca/business/local-business/construction-in-halifax-not-keeping-pace-with-apartment-rental-demand-398659/ Zoning changes and changes to multifamily dwelling criteria are being requested by local experts to allow for more single-family homes to be converted to help alleviate the pressure on new construction.

For home buyers looking to downsize or who want to lessen their responsibilities by changing to a rental situation, they are hesitant to put their property on the market with the lack of options of places to move to. These demographic rates create a bottleneck and low inventory for the housing market overall and there does not seem to be any relief soon with the mortgage rates expected to remain the same over the next year.