Halifax

Welcome to Halifax

The Halifax Regional Municipality (HRM) continues to be one of Canada’s most important real estate markets to watch. Over the last year, the city has seen a sustained set of buyers, many of whom are remote workers, attracted by its affordability and natural beauty. Nova Scotia’s maritime environment is undoubtedly one of its biggest draws, with its picturesque coastline and scenic landscapes attracting buyers domestically and abroad. It’s not only the landscape that is attracting buyers. There has been a collaborative effort between the government and industry to draw in skilled workers from Canada’s major cities, particularly focusing on the tech industry.

So far in 2023, there were 250 single-family homes listed in Halifax over $1 million, comprising 9.4 per cent of the market. This compares to 164 for all of 2020, comprising 2.4 per cent of the market. In the first half of the year, the average price for a residential class home in the $1 - 3.99 million bracket was $1,344,279.

While the number of residential class homes in the Halifax market is increasing, the number of condos priced over $1 million is sparse, but slowly growing. New condo developments are popping up all over Halifax, including The Cogswell District construction project — one of the biggest city-building projects in the history of Halifax, which broke ground this year.

There was one notable sale of a home priced over $4 million in April 2023 for $4,320,000. Homes of this scale are typically lavish, offering breathtaking waterfront views and unparalleled levels of privacy. They are truly extraordinary and are often undervalued when compared to similar properties throughout other areas of Canada. Only six homes in this price range were listed in the first half of 2023, making them a novelty rather than the norm.

“Halifax’s population sat at 480,523 as of January, and we are on a trajectory to reach 1 million people by 2025. Of new residents to Halifax, 74.4% were aged 15-44, the largest segment of this age group ever recorded. Many originate from Ontario, Vancouver and Alberta, and have built home equity in these markets. This is translating into multiple offers in the $1 - 3.99 million market, as well as across the conventional market.”

Donna Harding License Partner Engel & Völkers Nova Scotia

Residential home sales breakdown

2023 kicked off with a surge of interest in the Halifax real estate market, particularly for properties priced under $1 million. Engel & Völkers is reporting this trend began in midDecember 2022, shortly after the Bank of Canada signaled it was ready to pause its aggressive rate hike cycle. While buyers clamoured for homes under $1 million, year-over-year sales for homes priced over $1 million decreased from 17 to 13 in January. Though fewer units were sold, the average sold price grew by 3.18 per cent year-over-year, and new listings grew from 18 to 27 year-over-year.

The pace was sustained through February, and while interest rates had some effect, it was much less pronounced than in other markets across the country. Sales prices trended downwards in some parts of the market, but overall values remained higher than in 2020. In the conventional market, the Nova Scotia Association of REALTORS® (NSAR) reported the average price for a home in Nova Scotia in February 2023 was $403,032, 4.6 per cent less than in February 2022 but 56.5 per cent higher than in February 2020.

In March, conventional market prices trended downwards further, but even so, Halifax remained a strong seller’s market due to a lack of inventory and consistent demand. The number of units sold valued between $1 - 3.99 million was down from 37 to 15 year-over-year, while the number of listings grew from 31 to 38 year-over-year. Despite the increase in supply, the average price in this segment in

March grew from $1,155,500 to $1,325,076.

This trend in the $1 - 3.99 million segment continued into April, seeing fewer units sold while supply grew, and price averages outpaced the year before. In the conventional market, the Canadian Real Estate Association (CREA) reported the Halifax and Dartmouth areas saw the highest house price gains in the country during April — where house costs jumped up to 7.6 per cent month-over-month.

The HRM’s vacancy rate sat at one per cent throughout 2022, and this long-term supply crunch showed its effect in April 2023 rental data. In April, the average monthly rent for a one-bedroom apartment jumped by nearly 25 per cent to $2,089 per month. The average rent for two-bedroom apartments grew by 21 per cent to an average of $2,483 per month. This jump can be attributed to high demand, but also fixed-term leasing, which allows landlords to bypass rent caps when a one year fixed-term lease expires.

In May, in the $1 - 3.99 segment, inventory grew by 22.4 per cent month-over-month. Though inventory grew, supply was still precariously short across the province. By the end of May, CREA reported 2.6 months of inventory across Nova Scotia, up from 1.9 months recorded at the end of May 2022. This was below the long-standing average of 6.1 months typical for this time of year and was 20.8 per cent below the 10-year average for the month of May.

On May 27, a major wildfire started in the Hammonds Plains area of the HRM. This fire spread quickly, evacuating over 16,000 residents and leading to the loss of 151 homes. Meanwhile, at the same time, near Barrington Lake outside of Halifax, a second forest fire burned approximately 56,871 acres of land and led to the loss of 60 home and cottage structures. The Provincial governments and municipalities declared a local state of emergency in the communities affected by the wildfires, resulting in school closures and power outages just outside Halifax and lasting over a two week period. Real estate trading largely paused, and buyers trying to close deals within the wildfire radius had trouble securing home insurance due to temporary holds.

The real estate pause continued into June, as Haligonians rallied to support their neighbours affected by wildfires. The number of listings remained consistent, but the number of units sold in the $1 - 3.99 million category fell compared to what was expected, dipping by 43.75 per cent month-over-month.

Market Outlook

Halifax remains a seller’s market for homes priced between $1 - 3.99 million. Homes priced over $4 million are categorized as a buyer’s market, which is typical for this price point.

Engel & Völkers expects the market pace from the first half of 2023 to continue into the second half of the year, sparing a six to eight week lull due to the wildfires. Halifax’s growth projections and limited supply suggest it will continue to be a strong seller’s market.

Record-breaking migration has left Halifax’s market in a bind. Some sellers want to downsize but have nowhere to go and as a result are stuck in a market gridlock. Low inventory for homes to purchase will continue to define the Halifax market.

Low rental inventory is a primary concern, and purpose built rentals will be needed to fill the supply gaps. New construction is being absorbed expeditiously and cannot keep up and, as a result, demand from Halifax locals and newcomers.

Neighbourhoods To Watch

Halifax