The St. John's metro area has seen a 45% growth in housing starts over the same month last year says Chris Janes, senior market anlaysist with CMHC in Newfoundland and Labrador. The strength of the local economy has sustained new home construction and buyers looking for newly built custom homes have driven the demand. The year to date growth in St. John's metro area was up 30%.
In Atlantic Canada, the housing starts in Urban centers was down by 31% in April compared with April of 2008. For Canada's urban centers housing starts were down by 53% in April compared to April 2008.
We are seeing a continued strength in the Newfoundland market while there still is year over year weakness in the rest of the country. This strength in our market when the rest of Canada's real estate market is showing signs of weakness is unusual. It seems the strong growth seen in Newfoundland last year will have a followup year that tells a similar story.
While we cannot conclude anything definite about market prices being up or down from a year ago, it is interesting to note that housing starts in Newfoundland are increasing suggesting there is strong demand for real estate in the St. John's area. As always, prices will be determined by demand. I expect that prices will maintain the current levels over the summer months yet I would not be surprised to see them increase slightly by year end.
Today's buyers who are hesitant to make a purchase now are only deferring the inevitable. It is frequently difficult to buy a home when prices are climbing further but unless one takes action, the subsequent years find home prices higher than the previous one. Buying in a strong market is like swimming in a cold pond on the 1st day of June. Sometimes you just have to hold your nose and jump in.
R. Greg Osmond is a Platinum Award winning Realtor serving St. John’s and surrounding areas, Newfoundland and Labrador for over 20 years and can be reached at 709-895-2500. Visit http://www.rgregosmond.com/ for further information.
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