We’ve been seeing price increases every year for the last several years in the Halifax real estate market. Currently, the average sale price in the HRM is 82% higher than it was five years ago, or $261,000 higher. The real estate market was supposed to crash a long time ago, but things keep ticking along as they always do. However, I can’t help but wonder: is this sustainable, or will we finally reach a breaking point?
Before I get into it, if you’re new here, my name is Johnny Dulong, and I’ve been a realtor in Halifax for 23 years. If you like this content, just go ahead and hit that like button and subscribe. If you’re thinking about making a move in the Halifax-Dartmouth area or if you just want to talk about the real estate market, you can reach out to me anytime.
For context, five years ago in the HRM, our average sale price was about $319,000. That’s gone up about 82% to $580,000 today. If I back it up even more and go all the way back to 1980, the average sale price increase year-over-year since 1980 is 5.7%. In all that time since 1980, there’s only been one year that the average sale price has gone down in HRM year-over-year, and that was back in 1995. It was very minimal, almost just a blip on the radar.
Even if I look at the 5.7% year-over-year growth on average, many of you might say that includes the last few years of the pandemic market, which were really crazy. Yes, they were. In 2020, we saw about a 15% increase from 2019. Then in 2021, sale prices jumped a further 26%, and in 2022, they went up another 16%. But hang on a second—even if I take out those big three years (2020, 2021, and 2022), from 1980 to 2019, the average growth year-over-year is still 4.8%. For argument’s sake, let’s call it 5% average year-over-year growth, which is what we’re accustomed to seeing in the HRM.
If we take these stats and apply them to future years, here’s what it looks like: three years from now, with a 5% growth year-over-year, we’d be at about $671,000 average purchase price. Five years from now, we’d be at about $740,000 average sale price, and in 10 years from now, we’d be at about $945,000 average sale price across the HRM.
I’m a big believer that history will repeat itself. However, to be honest, when I look at these five and ten-year projections for the average sale price based on a 5% growth year-over-year across the HRM, it’s a really hard number for me to wrap my head around. It doesn’t matter what I think about the metrics or anything like that; it’s just a very difficult number to comprehend. Especially when you consider that right now, even at $580,000, real estate prices are considered very expensive here in Halifax. The thought of almost doubling that is pretty insane to me, especially when people are struggling financially, even outside the real estate world, just with the overall cost of living here in Nova Scotia.
Here’s the whole point of this video: when I look at the metrics, the stats, and everything happening around Nova Scotia and Halifax in the housing market, this is what I’m talking about. Right now, we have very little supply for the demand that we currently have. We’re adding a ton of people to the province every year—about eight people for every one unit of housing that we’re building. We’re adding over 30,000 people to the province every year. I forget the exact number, but it’s a big one. Based on the current situation, we’re not building enough houses. For context, in Nova Scotia, we’re only building about 4,500 houses a year. On top of that, rates are projected to decrease soon, which will likely bring more buyer demand into the market and put upward pressure on pricing.
My point is, all these metrics lead me to believe that this trend is not going to start going backward anytime soon. I think it’s likely to keep moving upward. On the other hand, when I consider that we have some of the highest taxes, lowest wages, and highest expenses and cost of living in the country, it’s hard for me to wrap my head around those five and ten-year projections I talked about earlier. It brings forth the question: are we about to hit the breaking point? Are we getting to a point where people just won’t be able to afford homes? If they can’t afford them, there will be less demand in the market, which means supply will increase, potentially leading to a decrease in price points. But to be honest, I don’t see that happening.
I understand that might be an unpopular opinion, and that’s fine. Everyone is entitled to their own opinion. If you have one, drop it in the comments. Do you think the market’s going to crash? Do you think we’re hitting that breaking point? Or do you think things will keep steadily moving ahead as they always have, at least since I pulled those stats back from 1980? It’s a good question, and the truth is, nobody really knows. I can tell you that if you think I’m not privy to it, well, I live in Halifax. I understand the cost of living. I feel the cost of living when I look at my tax bill, utility bills, gas bill, and food bill. I feel that pinch just like everybody else does. On top of that, I’ve been a real estate agent for 23 years. For example, almost every time I’m writing an offer, I think it’s a bit crazy because I remember the price points from five years ago like it was yesterday. If anything, if we see any softening at all, I think it will just be a more stagnant period that will allow wages and such to catch up. But truthfully, I don’t see that happening, and I don’t see prices going down. If they start going down, people simply won’t move. They won’t sell and lose $100,000 on their biggest investment just because they want to move. The only people moving in a market like that would be those forced to move—due to divorce, death in the family, moving out of the province, or financial reasons.
My point is, I don’t think the market is going to go down. But again, nobody really knows. You’re entitled to your opinion, and I’d love to hear about it in the comments below. Here’s the big thing I want to talk about as well. I understand that five and ten-year projection I showed earlier is crazy and almost a scary number to wrap your head around. But my point is, every single decade, that number seemed crazy until it happened. Let’s take a look at these numbers. In 1980, the average sale price was $53,000. Fast forward 10 years to 1990, it’s $97,000—that’s an 83% increase in a decade. In 2000, it was a 32% increase to $128,000. By 2010, it was $254,000, almost a 100% increase, doubling from 2000 to 2010. In 2020, it went up 46% from the previous decade to $370,000. Just to reiterate, right now it’s $580,000 across the HRM.
On top of this, think about everything that’s happened since 1980. We had crazy interest rates, tons of stuff going on in the world, a complete financial crisis, and the market still ticked along at its average of almost 5% year-over-year here in small old Halifax, Nova Scotia. My point is, it always seems crazy until it’s right in front of your eyes. It always seems crazy until it’s right there. I remember people in 2021 talking about waiting for the market to cool down before buying a house. Many of those people still haven’t bought. But think about this: if you did buy in 2021 at an average purchase price in HRM, today in 2024, you would have approximately $120,000 of equity in your property as an average sale price statement. That’s not including what you’ve paid off on the mortgage in those three years, which I know would be minimal based on the interest rates. My point is, it always seems crazy until it’s right in front of your face.
So, where will we be in 10 years? Nobody really knows. You’re entitled to your opinion, and if you’re still here watching, you obviously have a bit of interest in this topic. I would love to hear about it in the comments below. As for me, I’m not going to sit on the fence on this one. I’ll give you my opinion: if I were a betting man, I would bet on around a 5% increase year-over-year for the next 10 years, just like we’ve been seeing since 1980. That’s my honest opinion. I think it’s going to be slow and steady, the way it’s always been. I think history will repeat itself. One thing is for sure: no matter what the outcome, it is definitely going to be an interesting time to be living on the east coast of Canada.
Until next time, thank you so much for connecting. I really appreciate your support, and have a great day.
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