Small town life

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Buyers seek a balance between liveability and affordability as smaller markets become a viable option

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As part of their retirement plans, Theresa Hughes and her husband, Wayne, decided to sell their Toronto home and return to Fredericton, NB to build their dream home and help their son get his footing in the real estate market. They soon discovered that it was easier said than done.

For starters, pandemic lockdowns forced them to virtually tour their homes with their real estate agent and the selection was small. They were advised to write a letter to sellers to help them differentiate themselves in a competitive market and ended up in multi-home purchases before buying a home for tens of thousands of dollars above list price.

“You hear about million-dollar homes in Toronto that cost $80,000 too much, but these are $300,000 homes,” Hughes says. The process was so stressful that she developed hives. Her son and his girlfriend are supposed to take over the purchased house as soon as their new home is ready. “We thought we would be in our new home by now, but it took months to even find a builder. The dig will finally begin this spring in a golf community.”

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Quality of life

Still, the family has no regrets. “It’s nice to be back. The people are so friendly… It’s more relaxed than Ontario. It takes five minutes to get anywhere,” says Hughes. “The job market, especially for younger people in trade, is strong… but outsiders are pushing up the cost of starter homes so the kids can’t get into the market here.”

According to Re/Max Canada’s 2022 Small Markets Report, many Canadian home buyers are moving to small markets, followed by affordability of quality of life, such as green spaces and neighborhood dynamism.

It defines the fastest growing small markets as those with the highest population growth in 2021 and a population below 440,000, with secondary markets below 100,000.

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House prices in those markets have risen significantly year-on-year from 17 to 38 percent and have not stopped their upward trajectory, with prices in some regions expected to rise another three to 20 percent for the remainder of the year.

Sales have been boosted, at least in part, by Mom and Dad’s bank: 25 percent used financial support from family to fulfill their home-buying dreams, according to an Army survey commissioned by Re/Max Canada.

Meanwhile, 28 percent of people who currently live in larger markets would like to move to a smaller market in the next two years.

“Liveability is all about quality of life, and as we all work to enjoy the things we love most in our communities again, it’s no surprise that it matters so much to Canadians – especially now,” says Re/Max Canada President Christopher Alexander.

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Right balance

“Despite the challenges facing the national housing market, smaller communities are viable options for Canadian home buyers seeking the right balance of livability and affordability.

The projected increase in house prices for the remainder of 2022 by our network of brokers and brokers is a good indicator of the appeal of these communities.”

The great interest in small towns does not seem to be waning. According to the Army survey, being able to work from home motivated 14 percent of Canadians to move to a smaller community and 11 percent said they would look for another job so they could stay in their community if their employer forced them to. to return to the office.

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However, the desire for livable communities goes both ways: 57 percent of smaller market dwellers worry that their city’s distinctive livability qualities could be eroded by rising demand from relocating buyers.

And 43 percent share the same fear of rising prices, believing they may be priced out of their communities if the trend continues.

according to the numbers

Below are the average sales prices of homes in some of the smaller markets across the country as of the end of the first quarter of this year and in parentheses the average price outlook at the end of the year:

Whitehorse, YT: $511,400 (+3%)

Kelowna, BC: $965,000 (+5%)

Red Deer, Alb.: $352,000 (+4%)

Brandon, Male: $284,400 (+4%)

Oshawa, Ontario: $1,048 million (+15%)

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Carleton, Ontario: $675,000 (+15%)

Moncton, NB: $355,000 (+15%)

Halifax, NS: $577,300 (+19%)

Summerside, PEI: $300,000 (+5.5%)

Source: Re/Max Canada

regional markets

Atlantic Canada. Moncton, NB, Charlottetown and Summerside, PEI, and Truro and Halifax, NS are all in the seller’s area, with county buyers driving sales activity. Most buyers want detached homes with plenty of living space and in some cases on the water.

Ontario. Smaller markets have seen an influx of out-of-town buyers seeking affordable housing, larger living spaces and a close-knit sense of community. Many, including Oshawa, Carleton Place and Arnprior, have the infrastructure and public transportation so workers can easily commute to the city.

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Western Canada. Small markets continue to favor sellers. Many welcome buyers from other regions and provinces – especially Ontario – with an interest in single-family homes. In recent months, those regions have seen stronger buyer confidence and less urgency to buy a home, leading to fewer bidding wars and perhaps a signal that the market is beginning to stabilize.

Areas. Whitehorse is a seller’s market. Apartments and townhouses see the most activity in terms of both sales and new construction, but supply cannot keep up with demand and is pushing prices up. Whitehorse has been a hotspot for new immigrants, with municipal programs to help them integrate into the community.

Source: Re/Max Canada

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