MONTREAL ― The West is out, and the Maritimes are in.
That’s the broad view of Canada’s housing markets in a new comparison from Scotiabank, which found that things sure have changed in Canada’s housing markets since a policy-induced slowdown hit Toronto and Vancouver over the past few years.
While both of those pricey cities are now in recovery mode, to one extent or another, they are no longer among the hottest housing markets in the country ― or, put another way, the places where buying a house is hardest.
By Scotiabank’s metric, Montreal takes the cake, with 79 houses selling every month for every 100 coming onto the market ― a much higher ratio than normal.
But what may come as a surprise is that, of the top 10 markets in Scotia’s ranking, three are in the Maritimes ― Halifax, N.S., Moncton, N.B., and Saint John, N.B.
The Maritimes’ boom seems to have to do, at least partly, with the acceleration in immigration to Canada, which has spurred faster population growth in the area.
Watch: This Toronto house is going for less than a cup of coffee. Story continues below.
Real estate agents in Halifax note increased interest in their housing market from abroad; in Moncton, realtors suggest an influx of people from other parts of Canada, as well as from abroad, is pushing the market up.
The same factors helped Montreal’s housing market to first place, along with a jump in interest from foreign investors, who flocked to the city after foreign buyers’ taxes were put in place in the Toronto and Vancouver regions.
Those two places ranked 19th and 22nd, respectively, in the list of 31 cities, but they could soon be making a comeback. After what has now been a prolonged slump, sales are returning to more historically normal levels in Vancouver, and the experts are predicting the city’s year-long decline in house prices is about to end.
“Given the magnitude of the swing in the sales-to-listing ratio … we would expect the annual growth rate of Vancouver house prices to return to positive territory early next year,” Capital Economics predicted in a client note this week.
How does the ranking work?
Scotiabank ranks housing markets by looking at the sales-to-new-listings ratio, or the number of homes that sell every month, as a percentage of the new homes that come on to the market that month.
Then it compares that ratio to its long-run average, to see how much more (or less) active a market is than normal. The larger the deviation upwards, the hotter market, and the larger the deviation downwards, the cooler the market.