Saskatchewan is reporting above-average sales for the sixth consecutive month, with 757 sales across the province in December, a year-over-year gain of 19 per cent and 13 per cent above long-term, 10-year averages.
Year-over-year sales gains in the second half of 2023 failed to offset earlier pullbacks, as the province is reporting a 3 per cent sales decline compared to 2022. While the year-to-date sales decrease was forecasted as the market returns to pre-pandemic sales levels, much of the decline was driven by slowing detached activity. Meanwhile, apartment and semi-detached sales levels improved and continue to contribute to strong monthly sales.
Above-average sales were met with a decline in new listings, resulting in declining inventory levels throughout the year. Inventory levels across the province dipped by over 16 per cent year-over-year in December and remain nearly 35 per cent below the 10-year average.
“Higher lending rates continue to push prospective buyers to seek more affordable options within our market while inventory levels within that market segment remain extremely tight,” said Association CEO Chris Guèrette. “When paired with declining new listings in more affordable properties, there simply isn’t enough inventory in lower price ranges right now.”
The shift toward more affordable products has increased price pressures for apartment, row, and semi-detached property types. Meanwhile, detached homes, which account for the majority of sales activity across the province, reported similar prices compared to last year. Saskatchewan reported a benchmark price of $319,300 in December, down from $324,400 in November and nearly 2 per cent above December 2022.
“Saskatchewan’s housing market continues to benefit from the economic success in our province, including a strong labour market and record population growth,” said Guèrette. “Supply challenges, specifically in the more affordable segment of the market, remain our biggest concern when looking ahead to 2024 and are likely preventing even stronger monthly sales numbers.”
Regional Highlights
Despite a slight dip in year-to-date sales across many regions of the province, year-over-year sales activity increased across all regions except for the Northern Region and remain significantly higher than long-term averages.
The decline in new listings across the regions in 2023 continues to drive inventory levels well below long-term, 10-year trends. The Saskatoon-Biggar Region (4.42 months of supply) and the Regina-Moose Mountain Region (5.43) continue to experience the tightest conditions in the province – while the Swift Current-Moose Jaw Region (8.65), Yorkton-Melville (8.84), and Prince Albert Region (8.43) saw a shift to more balanced conditions.
Price Trends
Benchmark prices varied across the province in December, as the communities of Humboldt (+6.2 per cent), Meadow Lake (+4.2), Melfort (+0.7), Melville (+4.8), Moose Jaw (+1.4), Prince Albert (+2.3), Saskatoon (+5.5), and Yorkton (+1.8) all reported year-over-year price gains.
In contrast, Estevan (-7.5 per cent), Regina (-4.1), Swift Current (-4.9), and Weyburn (-5.3) reported year-over-year price declines.
City of Regina
The City of Regina reported 188 sales in December, a year-over-year gain of nearly 25 per cent and 24 per cent above long-term trends.
Despite significant new listing growth in December, the number of new listings decreased by 12 per cent in 2023. This resulted in further reductions in inventory levels, which remain over 33 per cent below long-term averages in the Queen City.
Strong sales and below-average inventory were not enough to prevent price adjustments in December, as the City of Regina reported a benchmark price of $299,800, down from $308,500 in November and 4 per cent below December 2022.
City of Saskatoon
The City of Saskatoon reported 230 sales in December, a year-over-year gain of 14 per cent and 10 per cent above long-term, 10-year averages.
Strong sales were again met with a pullback in new listings, resulting in further inventory declines, as inventory levels in the Bridge City are nearly 45 per cent below the 10-year average.
Tight market conditions supported modest price growth in December, as the City of Saskatoon reported a benchmark price of $374,100, up over 5 per cent from December 2022.
There were 1,006 sales reported across the province in November, a 10 per cent year-over-year increase, marking the fifth consecutive month of year-over-year sales increases in Saskatchewan. Much of the monthly sales gains were driven by rising activity in the Regina and Saskatoon Regions. As seen in previous months, year-to-date sales remain well above long-term, 10-year trends, as the province continues to report strong sales.
A slight year-over-year increase in new listings was not enough to offset above-average November sales, causing further retractions in inventory levels, specifically in homes priced below $400,000. Inventory levels decreased by over 16 per cent on a year-over-year basis and remain over 30 per cent below long-term, 10-year averages.
“Saskatchewan’s housing market continues to benefit from a strong economy, record employment and population growth,” said Association CEO, Chris Guérette. “These factors, when paired with our relative affordability, continue to support above-average monthly sales and stable demand in home ownership.”
The months of supply rose above five months in November, slightly higher than levels reported earlier this year, but still over 40 per cent below the 10-year average. Despite a slight gain in the months of supply compared to October, nearly all of the growth was in higher-priced products, as the more affordable segment of the market continues to face significant inventory challenges.
In line with typical seasonal factors, Saskatchewan reported a slight decrease in the benchmark price of $324,400 in November, down from $327,300 in October and up nearly 2 per cent from November 2022.
“Our market continues to outperform many regions across the country, as we once again report strong sales levels and prices that are holding relatively steady,” said Guérette. “Where we are similar to other markets, however, is that we are experiencing persistent inventory challenges, specifically in the more affordable segment of our housing continuum.”
Regional Highlights
Despite monthly fluctuations, year-to-date sales activity eased across all regions in the province in November, with the steepest decline occurring in the Swift Current-Moose Jaw Region. While year-to-date sales have decreased, the Regina-Moose Mountain, Saskatoon-Biggar, Swift Current-Moose Jaw, and Yorkton-Melville Regions are reporting sales well above long-term, 10-year trends.
The Saskatoon-Biggar Region continues to experience the tightest conditions across the province, with just over 3.5 months of supply reported in November.
Price Trends
Benchmark prices varied across the province in November, as the communities of Estevan, Humboldt, Melville, Moose Jaw, Prince Albert, Saskatoon, Weyburn, and Yorkton reported year-over-year price gains. Meanwhile, Meadow Lake, Melfort, North Battleford, Regina, and Swift Current reported year-over-year price declines.
City of Regina
The City of Regina reported 240 sales in November, up nearly 16 per cent year-over-year and 14 per cent above long-term, 10-year trends.
Strong sales and a decline in new listings failed to offer any supply relief in November, as inventory levels were down 21 per cent on a year-over-year basis and remain over 30 per cent below long-term, 10-year trends.
With only 3.5 months of supply, Regina continues to experience significant supply challenges in the more affordable segment of the market. Despite strong sales and relatively tight market conditions, the Queen City reported a benchmark price of $305,000 in November, down from $308,500 in October and nearly 3 per cent below November 2022.
City of Saskatoon
The City of Saskatoon reported 314 sales in November, a year-over-year increase of 18 per cent and nearly 10 per cent above the 10-year average.
Despite a slight year-over-year gain in new listings, strong November sales prevented significant supply growth, as inventory levels were nearly 50 per cent below long-term trends.
Tight market conditions continue to support price growth, as the City of Saskatoon reported a benchmark price of $380,000 in November, down from $382,700 in October but over 5 per cent higher than November 2022.
SASKATOON, SK – November 7, 2023 – Saskatoon’s proposed entertainment district could deliver a billion dollar boost to the city’s economy according to an independent study released today by the Greater Saskatoon Chamber of Commerce and Downtown Saskatoon. The comprehensive study, prepared by Saskatchewan-based PRAXIS Consulting, forecasts $1.37 billion in total economic impact over ten years driven by the development of the district, a new arena and substantially new convention centre.
“The potential economic spin-offs of this infrastructure project are becoming more and more clear,” says Jason Aebig, Saskatoon Chamber CEO, pointing to the local spending, direct and indirect jobs, hotel overnight stays and tax savings that will come with attracting new residents, visitors, and downtown businesses. “The positive impact this project could be significant, long lasting, and widespread if we can lever the right financing tools and private investment to get it done.”
The economic impact zone studied encompasses Saskatoon’s Downtown, and the residential neighbourhoods of City Park, Nutana, Riversdale, and Caswell Hill. The study quantified “economic impact” in terms of the net-new or incremental effects on the city of Saskatoon and province of Saskatchewan over and above the current impacts created by the city’s existing entertainment and conference facilities (i.e., SaskTel Centre and TCU Place).
Highlights of the study’s findings include:
“Not unlike other critical infrastructure projects, the cost-benefit of this investment is too significant to ignore,” says Brent Penner, Downtown Saskatoon’s Executive Director, pointing to the $552.6 million North Commuter Parkway, Traffic Bridge and Circle Drive South Bridges. “This particular infrastructure project has the potential to be a magnet for density, private investment, new jobs and young workers which is why cities across North America see the value and are taking action.”
The study also calculated the cost of missed opportunities to host touring events, large gatherings, and major conferences if Saskatoon fails to keep pace with industry needs and other western Canadian cities.
According to the management of the SaskTel Centre and TCU Place, Saskatoon is passed over by several large touring acts and major conferences/conventions each year because of the physical limitations of the existing facilities.
For music and entertainment events, each missed opportunity costs:
For major 2-day, 1,000 attendee conferences or conventions, each lost bid costs Saskatoon:
“Increases to property taxes is a concern we share,” observes Aebig. “If we put band aids on our aging buildings, 100% of the cost will hit our property tax bills as they continue to deliver less and less. The best way to optimize a return on investment for Saskatoon taxpayers are modern facilities, in a residential and entertainment district development, that can be financed through non-tax tools, various levels of government and private investment.”
The Chamber and Downtown Saskatoon await the business plan for the development of the district, and construction and redevelopment of its anchor facilities, to assess its overall feasibility and affordability.
“What we do know that Saskatoon taxpayers can’t afford the costs of residential sprawl, the inability to attract skilled young people, and maintaining aging facilities that can’t compete or serve the community,” says Aebig. “We need modern facilities, in a downtown district, that can be magnet for investment, people and jobs and keep Saskatoon on the map.”
The study notes the tremendous impact Saskatoon’s current facilities have had on the city’s economy and quality of life since SaskTel Centre’s opening nearly 40 years ago and the construction of TCU Place in 1967.
It also highlights Saskatoon’s advantage as home to Saskatchewan Polytechnic and University Saskatchewan, and the opportunity to retain young workers and graduates through the development of a thriving downtown entertainment district.
“Thanks to the vision of our city’s leaders decades ago, who had the courage to invest in this infrastructure and relocate the rail lines out of our downtown, Saskatoon has grown and prospered in countless ways,” observes Penner. “It’s our turn to make sure that Saskatoon is set up for success in the next 40 years.”
Saskatchewan reported 1,259 sales in October, a year-over-year gain of 11 per cent and nearly 13 per cent above long-term, 10-year trends. Above-average October sales in the province can be attributed to gains in the detached, apartment and townhouse/row-style sectors. Despite year-to-date sales remaining slightly below levels experienced last year, Saskatchewan continues to report sales activity much stronger than the 10-year average.
As seen in prior months, supply challenges continued to persist across many regions of the province in October. Inventory levels fell by over 15 per cent compared to last year and remain over 30 per cent below the 10-year average. Adjustments to sales and inventory levels, paired with declining new listings, resulted in the province reporting below five months of supply in October, a 23 per cent year-over-year decrease and over 40 per cent below long-term, 10-year averages.
“Higher lending rates continue to impact both demand and new listings in our market, which is likely preventing even stronger October sales numbers,” noted Association CEO, Chris Guérette. “Prospective move-up buyers are facing challenges amid higher interest rates and ongoing inflationary pressures, and we’re seeing a trickle-down effect with limited supply growth in the lower price ranges, which remain extremely competitive.”
With 4.5 months of supply, the province is reporting the tightest conditions heading into November since 2007. Despite tight market conditions, home prices remained relatively stable this month. Saskatchewan reported a benchmark price of $327,300 in October, down from $328,000 in September and up nearly 2 per cent from October 2022.
“Our market continues to demonstrate its resilience, as many have predicted, and we’re once again reporting strong sales despite inventory challenges, inflationary pressures, and higher lending rates,” said Guérette. "Saskatchewan is affordable, we’re growing at the fastest pace in over a century, and we’re well positioned for stable demand in home ownership.”
City of Regina
The City of Regina reported a record high 312 sales in October, a year-over-year increase of 24 per cent and 29 per cent above long-term, 10-year trends. While the Queen City experienced a year-over-year gain in new listings, record October sales prevented inventory gains, as Regina continues to report inventory levels nearly 30 per cent below the 10-year average.
Regina is once again reporting below three months of supply, and the more affordable segment of the market continues to be extremely competitive. Despite record sales and tight market conditions, Regina reported a benchmark price of $308,500 in October, down slightly from $308,700 in September and 1.2 per cent below October 2022.
City of Saskatoon
The City of Saskatoon reported 382 sales in October, a year-over-year gain of 20 per cent and 12 per cent above long-term, 10-year trends. New listings failed to offset a sixth consecutive month of above-average sales, resulting in the lowest October inventory levels reported in the Bridge City since 2007.
With just over two months of supply in Saskatoon, we continue to see upward pressure on home prices. The benchmark price reached $382,700 in October, up from $381,900 in September and nearly 4 per cent above October 2022. Year-over-year price gains were reported in all property types, ranging from one per cent in semi-detached properties - to an eight per cent increase in townhouse/row-style properties.
Saskatchewan reported 1,295 sales across the province in September, a year-over-year gain of 2.5 per cent and 6.3 per cent above long-term, 10-year averages. While year-to-date sales have eased compared to last year, Saskatchewan continues to report sales well above long-term trends.
Supply challenges continued across the province in September, as inventory levels were over 12 per cent lower than levels seen last year and nearly 32 per cent below the 10-year average. As inventories improved in higher-priced properties, much of the inventory decline is once again being driven by homes priced below $400,000, as the more affordable segment of the market remains highly competitive.
“As seen in previous months, significant supply challenges continue to persist across Saskatchewan, specifically in the more affordable segment of our housing continuum,” noted Association CEO, Chris Guérette. “Inventory challenges and higher lending rates are, without question, impacting sales activity across the province, but relative affordability paired with strong economic growth is supporting above-average sales in our market.”
Strong September sales and ongoing supply challenges translated to 4.8 months of supply across the province, the lowest level reported in September since 2009. The provincial benchmark price reached $328,000 in September, up slightly from $327,800 in August and 1.1 per cent above September 2022.
“Provincial prices remain stable as price gains in Saskatoon, Prince Albert, and Yorkton offset price declines in Regina and Swift Current in September,” said Guérette. “Ultimately, real estate is local, and conditions vary across the province. That said, supply challenges in the lower-priced, more affordable segment of our market remain a significant concern provincially.”
City of Regina
The City of Regina reported 305 sales in September, a year-over-year increase of 7.4 per cent and 15 per cent above long-term, 10-year trends.
Strong September sales were met with a decline in new listings, contributing to further inventory declines. With 3.2 months of supply, conditions have not been this tight in the Queen City since 2011.
Despite strong monthly sales and tight market conditions, the City of Regina reported a benchmark price of $308,700 in September, down from $313,100 in August and $319,200 in July.
City of Saskatoon
The City of Saskatoon reported 374 sales in September, a year-over-year increase of 14 per cent and nearly 8 per cent above long-term, 10-year trends.
Saskatoon is reporting year-over-year sales increases for the fifth consecutive month. When paired with decreasing new listings, the Bridge City is reporting 2.6 months of supply, the lowest level seen in September since 2007.
Tight market conditions resulted in the City of Saskatoon reporting a benchmark price of $381,900 in September, up from $378,300 in August but below July’s record benchmark price of $384,200.
Saskatchewan reported a record-high 1,631 sales in August, a year-over-year increase of 11 per cent and nearly 25 per cent above long-term, 10-year averages.
Strong August sales were met with a pullback in new listings, contributing to a decrease in inventory levels for the month. As seen in prior months, the inventory decline was largely driven by homes priced below $400,000, as the more affordable segment of the market remains highly competitive.
“Saskatchewan is once again reporting strong sales despite ongoing inventory challenges, inflationary pressures, and higher lending rates,” said Association CEO, Chris Guérette. “Higher interest rates are pushing more purchasers to seek out more affordable options in the market, and, as a result, we continue to experience significant supply challenges in the lower price ranges of our market. These persistent supply challenges are likely preventing even stronger sales activity in August.”
Record sales and low inventories caused the provincial months of supply to drop below four months – below three months in Regina and below two in Saskatoon – reflecting the tightest market conditions seen heading into September since 2007. Despite tighter market conditions, Saskatchewan’s benchmark price eased slightly in August, primarily due to declines in the more expensive detached and semi-detached markets. Notwithstanding price adjustments following months of steady growth, prices remain comparable to levels reported last year.
“Our province continues to benefit from its affordability advantage, record population growth, and gains in international migration. Unfortunately, when housing supply fails to meet the increased demand, as seen in other jurisdictions across the country, inventory challenges become a real concern, and affordability can be eroded,” said Guérette. “We continue to keep a very close eye on inventory levels, specifically in the more affordable segment of our market.”
City of Regina
The City of Regina reported 359 sales in August, a year-over-year increase of nearly 6 per cent and 22 per cent above long-term, 10-year trends.
Rising August sales were met with a pullback in new listings, resulting in further inventory declines and the months of supply dropping below three months. Despite tighter market conditions, the benchmark price in the Queen City eased over last month due to pullbacks in the higher-priced detached sector.
Regina reported a benchmark price of $313,100 in August, down from $319,200 in July and $318,700 in June.
City of Saskatoon
The City of Saskatoon reported 528 sales in August, a year-over-year increase of 20 per cent and over 36 per cent above long-term, 10-year trends.
Increased sales and lower inventories caused the months of supply to dip below two months, the tightest levels reported so far this year. Despite extremely tight market conditions, Saskatoon’s benchmark price fell to $378,300 in August, down from $382,400 in July and $381,400 in June.
While monthly variations are not uncommon, it is important to note that prices in the Bridge City remain higher than levels reported last year, and well above the $364,900 reported in January 2023.
Saskatchewan reported 1,560 sales in July, a year-over-year increase of 9 per cent and nearly 13 per cent above long-term, 10-year averages. Much of the increase was driven by property priced below $300,000, as the more affordable segment of the market remains highly competitive.
As seen in prior months, inventory levels remain a significant challenge in many areas of the province. Despite a slight increase from last month, inventory levels were 11 per cent below levels seen in the previous year and over 30 per cent below the 10-year average. While inventory challenges continue to impact the more affordable segment of the market, there have been slight inventory gains in properties priced above $300,000.
“Higher lending rates continue to impact both buyers and sellers, with many consumers seeking more affordable options in our market,” said Association CEO, Chris Guérette. “Potential move-up buyers are less likely to list in the current rate environment. When paired with persistent inventory challenges, the more affordable segment of the market remains extremely competitive.”
Despite a modest gain in the months of supply, which reached over four months in July, conditions remain tighter than last year and significantly below long-term trends. Tighter market conditions again resulted in month-over-month price gains, as Saskatchewan’s benchmark price reached $333,100 in July, up from $331,500 in June and $329,600 in May.
“While inventory levels remain a concern for us, Saskatchewan is once again reporting sales levels well above long-term trends,” said Guérette. “Our market continues to benefit from a strong economy and record population growth, which is proving to help offset some of the impact caused by another policy interest rate increase by the Bank of Canada.”
Regional Highlights
As seen in prior months, year-to-date sales activity has eased across many regions of the province. Despite the year-to-date decline, many regions are reporting sales levels above long-term trends.
Adjustments in inventory levels continue to vary across the province. However, many regions continue to report inventory below long-term, 10-year averages. The Saskatoon-Biggar region is experiencing the tightest conditions in the province, with less than three months of inventory.
Price Trends
The benchmark price varied across Saskatchewan communities in July, with many regions reporting year-over-year and monthly price growth.
The City of Estevan was the only region to report both yearly and monthly price decreases. In contrast, Saskatoon, Prince Albert, Yorkton, and Meadow Lake all reported record-high benchmark prices in July.
City of Regina
The City of Regina reported 352 sales in July, a year-over-year decline of less than 1 per cent. Despite the slight year-over-year decline, July sales levels were nearly 17 per cent above long-term, 10-year averages.
A pullback in both sales and new listings prevented any significant change to the inventory challenges being experienced in Regina. Despite a slight month-over-month improvement in the months of supply, market conditions remain tight in the Queen City.
Regina reported a benchmark price of $319,200 in July, up from $318,700 in June and $316,100 in May.
City of Saskatoon
The City of Saskatoon reported 497 sales in July, a year-over-year increase of 11 per cent and nearly 16 per cent above long-term, 10-year averages.
Strong sales levels prevented any significant change in inventory levels in July. Despite a slight increase in the months of supply, conditions remain extremely tight in the City of Saskatoon.
Saskatoon reported a record benchmark price of $384,200, up from $381,400 in June and $380,100 in May.
The nation is in the clutches of the largest housing shortage it’s ever experienced—and there’s no relief on the horizon.
The lack of homes available for sale has caused prices to swell over the past few years and had led buyers to continue battling it out through bidding wars and offers over asking even as mortgage rates have surged.
The country is short between 2.3 million and 6.5 million housing units, according to Realtor.com® estimates.
“It’s primarily underbuilding that’s driving the housing shortage,” says Danielle Hale, chief economist of Realtor.com. “Builders haven’t kept pace with the number of people that need housing.”
How did we get to this crisis point? Well, the population has more than doubled since 1950. More Americans are living longer, and they all need homes. But builders have struggled to ramp construction back up since the Great Recession.
And higher mortgage interest rates, hovering around 7%, are leading many would-be sellers to stay put instead of downsizing into smaller homes and freeing up the larger ones for families. Moreover, in recent years, investors have competed directly against first-time buyers for affordably priced single-family homes.
“The housing shortage is a problem that developed over the housing crisis a decade ago, and it’s probably going to take a decade to get out of it,” says Mark Zandi, chief economist at Moody’s Analytics.
So why aren’t more homes being built?
Builders have struggled to ramp up as about half of all construction companies went out of business during the Great Recession as homebuilding ground to a halt, according to the National Association of Home Builders. Many skilled laborers found jobs in other industries.
There was a roughly 80% drop in new construction from the peak, in the third quarter of 2005, to the trough, in the first quarter of 2009.
“If the population is going to grow and the pace of homebuilding is insufficient for that growth, then there’s going to be a housing shortage,” says Robert Dietz, chief economist of the NAHB. “You’d have to be building more than 1.1 million homes a year to meaningfully reduce the deficit.”
Today, says Dietz, the industry is suffering from a lack of construction labor, a lack of available lots, a lack of lumber and building materials, a lack of lending to builders and developers, and local laws and zoning requirements adding to the costs builders incur.
About a quarter of the final price of a new home is regulatory costs, says Dietz. Plus, higher interest rates means it costs builders more to borrow money for land development and construction.
In this post-COVID-19 world, the cost to put up a new home is 30% to 40% more than it was in 2018 and 2019, says Dietz.
“The cost of buildings is very high, so it makes it difficult to build homes at the low price point,” says Zandi.
In addition, the nation loses between 100,000 to 250,000 homes every year, according to NAHB. They’re torn down, destroyed by natural disasters or fires, or just deemed no longer habitable.
The bright spot in the housing market is the nearly 1 million apartments under construction, even though only a few hundred thousand are needed, according to NAHB.
While many of the newer units will be priced higher, landlords are likely to compete with one another for tenants. This could bring down rents in the markets with the largest oversupply of apartments.
“There is a record number of rental units in the pipeline,” says Zandi. “It all got disrupted during the pandemic. Builders couldn’t get appliances or building materials. A lot of the bottlenecks [since] got ironed out.”
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Get StartedIt would be easy to put all of the blame on the builders for the predicament the housing market is in. However, there are other forces at play.
Americans are living longer than they did decades earlier. So they’re occupying more homes.
“We’ve got two historically large generations, the baby boomers at the older end and the millennials on the younger end,” says Jenny Schuetz, a senior fellow at Brookings Metro, a think tank. “And the silent generation is living longer—staying healthier and living independently longer.”
There are more people living alone today than there were in previous years, especially seniors. Many folks who are 65 and older own their homes outright, so they don’t need to double or triple up with roommates. And as people have been having fewer children, they have less family available to take them in.
“We’ve gone from a world 40 years ago where most households were married couples with kids to a lot of empty nesters,” says Schuetz. “Single-person households are the fastest-growing segment of households and have been for a number of years now.”
On the other end of the spectrum are more young adults living with their parents longer. Younger generations often aren’t getting married as early as the baby boomers did. Many are also struggling with high rental and for-sale home prices. So they’re living in multigenerational homes or with roommates instead of moving out on their own or with their romantic partners.
“If people aren’t getting married at the same rates as prior generations, they still want to have some community,” says Chris Porter, chief demographer at John Burns Research and Consulting.
However, there aren’t enough young people shacking up with their families or roommates to offset the high demand for housing.
Even as builders put up more homes, they need to be the right homes for today’s buyers.
Many older Americans remain in their large houses, even well after their children have flown the coop. Some would prefer to downsize, but can’t find age-appropriate, smaller homes near their friends and family.
And even when the larger homes of empty nesters go up for sale, they’re often priced out of the ranges of growing families.
“We’re seeing more and more of a mismatch between the size of the household and the size of the house,” says Schuetz. “Younger households, including married couples and couples with kids, are living in smaller spaces than they’d like because that’s what’s available and that’s what they can afford.”
Another potential stumbling block is these larger, typically older homes might not be where younger folks want to live.
“It’s not clear that the places where there are a lot older homes are the places [younger households] would want to move into,” says Schuetz.
Higher mortgage rates, which the Federal Reserve hoped would cool the housing market, has actually wound up worsening America’s real estate crisis.
The problem is most homeowners with mortgages either purchased or refinanced into lower rates during the pandemic. If they put their homes on the market to move into new homes, they risk taking on higher rates near 7%—resulting in substantially larger monthly mortgage payments. So many are choosing to stay put for longer, including some homeowners who would have been likely to downsize.
In addition, investor sales of single-family homes spiked during the pandemic. They have been purchasing about a quarter of single-family homes on the market since mid-2021, according to CoreLogic data. Investor sales have remained strong despite higher mortgage rates as many of these buyers, ranging from mom and pop flippers to large corporations looking for homes they can rent out, pay in cash.
“We will be in a pretty low [housing] inventory environment for years,” says Lisa Sturtevant, chief economist of Bright MLS, the multiple listing service for the mid-Atlantic region. She expects the shortage to ease—at least a little as mortgage rates come down and more people move into homes that fit their needs. “But I still believe it’s going to be very, very tight.”
In the mid-Atlantic region, almost a quarter of all home sales were investment, rental, or vacation homes, she says.
As more communities crack down on Airbnb and other short-term rental properties, she anticipates more of these homes will go up for sale. About 12% of listings were for homes where an owner had passed away.
Vacation homes typically make up a small percentage of the housing stock.
Products and services offered by ISC have been affected by the 2023 Annual Fee Review and the extension of their Master Service Agreement with the Government of Saskatchewan (also its largest shareholder) to operate Saskatchewan’s public registries for another two decades.
REALTORS® should be aware that we have heard from some law firms that closing costs can be impacted significantly, as much as $500.00 – $1100.00, which may not provide enough time for your clients to budget appropriately.
Land Registry Fees
Corporate Registry Fees
There were 1,736 sales recorded across the province in May, resulting in a four per cent year-over-year decline. However, despite the year-over-year decline, sales levels were 20 per cent above long-term, 10-year averages.
Stronger sales in May were possible due to recent monthly gains in new listings. While the seasonal boost in new listings also caused inventories to trend up over the last month, inventory levels remain lower than levels reported in the previous year. They are at their lowest level reported in May since 2008. While year-over-year inventory levels have improved for homes priced above $300,000, more was needed to offset the declines occurring in the lower price ranges.
“Saskatchewan continues to benefit from a strong economy which is helping offset some of the impacts of higher lending rates, keeping sales activity above levels seen before the pandemic,” said Association CEO Chris Guérette. “Despite ongoing inventory challenges, our market is once again showing its resilience as sales remain above long-term averages.”
Adjustments in both sales and inventories in May caused the months of supply to fall below four months. As expected, tightening conditions contributed to monthly gains in the benchmark price. As a result, Saskatchewan’s benchmark price reached $329,600 in May, nearly two per cent higher than the month prior.
“Supply levels do vary across different regions of the province. For example, much of the inventory declines have been driven by the Regina and Saskatoon markets, while other parts of the province are reporting year-over-year gains. For any buyer or seller active in this market, it will be important to work with a professional to understand how market conditions can vary depending on property type, price range and location.”
Regional Highlights
Most regions across the province reported year-to-date sales declines in May. However, the Swift Current-Moose Jaw Region was the only region that saw sales activity fall below long-term trends.
Adjustments in new listings resulted in year-over-year inventory level gains in both the Swift Current–Moose Jaw and Yorkton-Melville regions. Despite recent shifts, inventory levels generally remain well below long-term averages across all areas of the province.
Inventory adjustments have kept conditions relatively tight across all regions of the province, but the tightest market conditions are being experienced in the Regina-Moose Mountain and Saskatoon-Biggar regions. Tighter market conditions also resulted in monthly price gains across all regions of the province.
Price Trends
The unadjusted benchmark prices varied across different regions of the province in May, with most regions reporting a monthly gain.
City of Regina
The City of Regina reported 418 sales in May, an eight percent year-over-year decrease. Although sales eased on a year-over-year basis, they remain far higher than the 10-year average and pre-pandemic levels. While new listings did report seasonal monthly gains, inventory levels remain well below what we traditionally see available in May.
Stronger sales compared to new listings prevented any significant change to the inventory challenges Regina is experiencing. This caused the months of supply to fall to 2.4 months in May, lower than the levels seen last year and last month. Tight market conditions resulted in monthly price gains as Regina reported a benchmark price of $316,100 in May.
City of Saskatoon
The City of Saskatoon reported 538 sales in May, nearly identical to sales in May 2022 and well above long-term averages. Despite seasonal gains in new listings, inventory levels remain well below the 10-year average.
Higher sales and lower-than-average new listings prevented any significant change in inventory levels, causing the months of supply to fall to two months. As expected, tighter market conditions are placing upward pressure on home prices. Saskatoon’s benchmark price reached $380,100 in May, a monthly gain of nearly two per cent.
Immigration push: tight supply and overwhelming demand fuel rising home prices in Canada’s most in-demand cities.
According to a recent report from Statistics Canada, Canada’s population grew by a record one million people in 2022, with almost all of the growth attributed to international migration.
With the federal government’s plan to welcome an additional 1.5 million immigrants by 2025, there is concern about how the increased demand will impact the country’s already-strained housing market.
Statistics Canada notes how the influx of newcomers “also represent additional challenges for some regions of the country related to housing, infrastructure and transportation…”
The issue of insufficient supply is frequently discussed in the industry, and many criticize governments’ lack of plans regarding housing.
There are several reasons for the immigration push, though, namely the need to fill ever-growing job vacancies and welcome refugees fleeing countries devastated by natural disasters and war.
The BC Real Estate Association’s Chief Economist, Brendon Ogmundson, explains, “We don’t have adequate supply because of the relentless level of demand from huge immigration and population growth, aside from the millennials who have been here.
“All of these people need to live somewhere, and without the supply, we get a lot of bidding on scarce assets, which pushes prices up.”
Tight spring markets are again leading to an increase in home prices in Canada’s most in-demand cities; the squeeze is being felt particularly acute in Toronto and Vancouver.
John Pasalis of Realosophy in Toronto points out, “When you have 20 or 30 people bidding on each property, it’s going to push prices up… At the end of the day, people still needed housing, so part of (pricing) is just the overwhelming demand for homes that help fuel price growth.”
Pasalis notes, “We’re seeing the effect of this mismatch between housing demand and supply and rapidly rising home prices, but also rapidly rising rents.”
However, in 2022, according to Canada Mortgage and Housing Corporation, Toronto had the highest level of housing starts since 2012. The region concluded 2022 at 45,109 units, a 7.6 per cent jump year-over-year. But the GTA’s market continues to be characterized as tight, with March supply levels down 44.3 per cent compared to March 2022.
Vancouver is also grappling with low supply, with a 35 per cent decrease in new listings last month compared to March 2022 and about 22 per cent below the 10-year seasonal average. Ogmundson points out that even now, with sales still about 20 to 25 per cent below historical averages, the lack of supply is once again leading to an uptick in prices.
Vancouver, for example, had about 8,600 listings on MLS in March, more than 17 per cent below the 10-year seasonal average. Ogmundson explains, “15,000 to 16,000 listings is healthier.”
Despite limited inventory, in March, the Real Estate Board of Greater Vancouver reported the average for all residential properties was $1.14 million — a 9.5 per cent decrease over March 2022 and a 1.8 per cent increase compared to February 2023.
“It will only get worse, and at a time when (interest) rates are still at 20-year highs. Rates will come down, and we’ll have all that new immigration, and supply still can be low,” Ogmundson explains.
“My worry is that we’ll see prices rising again — 10 per cent plus just isn’t healthy for the market.”
Tom Davidoff, associate professor and director of the Centre for Urban Economics and Real Estate at the University of British Columbia, explains that despite continued construction completion, “There’s still a tremendous supply shortage in the sense that homes are beyond affordable for many, many households and that’s from lingering, lack of supply.”
Ogmundson shares that in the past, B.C.’s policy has been about reducing demand through its foreign buyer tax and the federal mortgage stress test. The economist believes that, essentially, the government is misdiagnosing the problem.
Millennials are the province’s largest demographic, and demand is intense from those starting a family, Ogmundson says.
“It’s hard to fight that with any type of policy,” he says. “The assumption over the past 10 years that it’s all foreign money, foreign capital for investment, is not the case. Demand is still really strong even with all that we’ve done on that side [to curb it].”
Vancouver real estate agent Steve Saretsky agrees, “Developers are building one and two-bedroom high-rises, which are great for investors and maximizing cash flow. But it’s not so great for young families who can’t afford single-family houses.
He adds, “There’s nothing in between, in that ‘missing middle,’ which is the biggest demand, townhouses, duplexes, and row homes. We need to be building a lot more of that product and a lot less of these glitzy high-rises.”
On top of this, Davidoff points out that the lack of affordable housing has long been an issue in Vancouver, citing that rental affordability is most pertinent because it often impacts lower-income households.
“I think we are certainly seeing policy responses, for better or worse. Making sure that what gets built is largely rental as opposed to owner-housing. There’s been a shift to upzoning, which is very healthy,” Davidoff commented.
“The Province of B.C. is taking steps to make sure municipalities take on their fair share of construction. That’s a very positive development.”
These steps involve the province’s Homes for People plan, which will see $4 billion invested over three years and $12 billion over 10 years to build thousands of new affordable homes.
Davidoff hopes B.C. will scrap single-family zoning. He feels there’s too much of it in the country, especially in Greater Toronto and Greater Vancouver.
“It’s nonsensical (single-family) would be public policy (but) provinces are making some steps in (the other) direction. Generally speaking, let the market build the housing it wants to build up to reasonable density limits.”
Some Canadian jurisdictions have lofty goals to fill the supply gap. For instance, Ontario plans to build 1.5 million new homes by 2031, which many are concerned is too aggressive due to a shortage of skilled workers— the construction industry may struggle to keep up.
The Ontario government says it will open up the greenbelt to address the mismatch of housing supply and demand, and the federal government created a housing accelerator fund to help boost supply.
In December— Toronto City Council approved a housing plan to transform zoning bylaws to tackle the affordability crisis. The proposal will allow multiplexes to be built in areas currently restricted to single-family homes, legalize rooming houses citywide, and aims to build 285,000 homes over the next 10 years.
But, like many others, Pasalis is skeptical. “In the past 10 (years), I think we built 650 (thousand homes). You cannot triple or double completions overnight— the construction sector is running at full capacity. What we’re actually seeing on the ground is our builders slowing down with new launches. Construction starts will actually trend down over the next year, not increase.”
Ogmundson has noticed less blaming of housing issues on speculators and foreign investors, despite the federal government introducing a foreign homebuyer ban— and announcing amendments not long after it was enacted. That’s been a shift from the same government and people who used to talk about demand and tried to minimize that side of the issue. Now, they also talk about fixing the supply side.
Ogmundson feels this is positive, even if it’s happening too late.
Davidoff has had some success in convincing people that upzoning and charging developers for it is the way forward, but politicians are reluctant.
“I think there’s too much belief that government should achieve affordability by telling people how much they can charge rather than letting the market forces decide,” he says. “Obviously, some people can’t afford market prices, and the way to deal with that is not to hold lotteries for deeply subsidized units, where some people get a unit, but almost everybody gets nothing.”
Saretsky pointed out governments are trying to get more subsidies for transit-oriented communities but tying government funds to permits issued isn’t being done at a scale that’s needed. “There’s a lot of discussion around that politically right now … but no real action,” he said.
The supply squeeze regularly creates some challenging situations for Canadian realtors and their clients, from higher prices and bidding wars to a lack of available housing altogether. But, they’re doing their best and holding out hope for a more amenable market.
For example, Pasalis points out that clients must walk away if they’re priced out of the market. “That’s what was happening way more in 2021 and 2022,” he says. “Right now, people who are in the market know what they can afford – prices aren’t increasing very rapidly. The challenge now is low supply, lots of buyers but not a lot of listings, making for a very competitive market.”
As well, Saretsky has found the process takes people much longer than they’d like it to.
“I think there are a lot of frustrated buyers out there and that’s why we’re seeing these multiple offers. People are stuck, throwing in the towel, and trying to find a house in the last six months [when] inventory hasn’t got any better. We thought it would, as it usually gets better in the spring, but it hasn’t, at least not yet,” he explains.
It seems the best solution for the future is creating more affordable, dense housing with multi-unit zoning – which is certainly a big goal.
Ogmundson believes we need more housing, and we need it now. “We can either change neighbourhoods pretty dramatically with zoning and build more in what they call gentle density—row houses and the kind of thing you see in European cities—or we can keep things the way they are, and we’ll have status quo affordability, which no one is satisfied with.”
Davidoff hopes that single-family zoning will be abolished. “There’s way too much of it in the country, especially in Greater Toronto and Greater Vancouver. It’s nonsensical that would be public policy,” he says. “Let the market build the housing it wants to build up to reasonable density limits.”
He suggests building more and charging for the upzoning. “Freeze the zoning you get for free at current regulations. Then, charge for extra density. If you want to build more, you have to pay for the right. And selling those density rights can be extremely lucrative.
He adds, “Instead of building dedicated homes for low-income households with affordability mandates and forcing people who want to build condos to build rentals, just charge for the zoning … we’ll make the best use of it in mostly cash transfers to low-income households.”
Saretsky feels that more political discussion and coordination among all levels of government needs to happen.
“You’ve got the federal government saying, ‘Here’s our immigration target. You guys at the municipal level can figure it out.’ So, you let a million people into the country and have no plan, no coordination for infrastructure.”
He points out that at least some supply is better than nothing. But, Saretsky feels, “The problem is a lot of that supply is condos … raising families in a two-bedroom condo is not really what we’re used to. It’s not ideal, so we’ll continue to see a lot of demand for three-bedroom townhouses, row homes and duplexes. Hopefully, municipalities open it up and allow this to be built and more of it—I think that will certainly alleviate some of the price pressures.”
Industry professionals like Saretsky, Pasalis, Ogmundson, and Davidoff are calling for fresh ideas and action around addressing Canada’s housing supply issue.
While there is no single or simple answer to the shortage, and each jurisdiction’s needs will vary, the right solutions may lie in new and different zoning that allows for an increase of denser housing to accommodate Canada’s massive population growth now and in the future.
Plus, by having developers pay for upzoning, it fuels support for low-income rentals that are desperately needed.
Source:
Emma Caplan
Emma Caplan is a writer for Real Estate Magazine with over a decade of writing and editing experience in various content types and topics, including real estate, housing, business, tech, and home & design. Emma’s work has been featured in Cottage Life, the Vancouver Real Estate Podcast, the Chicago Tribune, Narcity Media, Healthline, Taste of Home, and BobVila.com. She holds a Certificate in Editing from Simon Fraser University.
This month, Jordan Boyes—broker/owner of BOYES Group Realty, Inc. (a member of Leading Real Estate Companies of the World®)—breaks down the trends that are motivating buyers to lay down roots in the province of SaskatchewanBOYES Group Realty, Inc.
Saskatoon, SK, Canada
Jordan Boyes
Broker/Owner
https://boyesgrouprealty.com
Tell us about your company.
We opened as a brokerage in 2015 and serve all of Saskatchewan, with 100 agents and three offices in Regina, Saskatoon and Battleford. We take pride in how collaborative we are, operating like one big team and not agents versus agents. We have a great training program, very competitive fee structures for our agents and great lead generation sources. We are well-versed in new developments and represent some of the city’s largest developers.
Please describe your leadership style.
I am very accessible to our agents, as is my staff. If someone has a question, it is rare that they have to wait more than 15 to 20 minutes to get an answer on anything. I am in the office every day by 5:30 a.m. and continuously strive to improve things for our agents so they can deliver the best service to their clients. How would you describe your current housing market?
After two years of rising prices, prices have stabilized, with the average home price around $375,000 CAD ($275,872 USD). Inventory is at record lows, which is holding prices quite steady.
What types of properties do you sell, and which are most popular?
Most properties we sell are residential homes and condos, but we also have a farm and commercial division, as well as a property management company.
What home features or amenities are especially popular with your buyers?
Buyers are looking for a good, solid home in a safe area. Almost all of the locations we serve are within a five- to 10-minute drive of all amenities, which appeals to most buyers.
What are some of the most important trends in your market?
Inventory basically dictates everything. With the rising cost of building we have seen over the last few years, it has really helped the prices and demand for resale properties.
What are your biggest challenges/opportunities for growth?
In a slowing global market, helping agents obtain business and keep their confidence up is especially important. Also, we are struggling to find homes for some buyers given the current environment with low inventory.
Are you seeing much foreign investment? What advice do you have for buyers outside of your area?
We don’t see a lot of foreign buyers, but we have plenty of people coming here from British Columbia and Ontario. With very affordable properties and high rental income, investors tend to see a good return on investment.
What do you love most about living in Saskatchewan?
The people. We are still a relatively small community overall. The farming community is a large majority of our population, and everyone is very humble and friendly. The ease of getting around means we can be anywhere in our city in under 30 minutes—even with the worst traffic.
What value do you get from being a member of LeadingRE?
LeadingRE gives us great exposure to other markets and referral sources we wouldn’t have had otherwise. We have the opportunity to network with people around the world and learn what strategies have worked for them, as well as those that haven’t. It allows us to get our company and our city in front of a larger audience.
SASKATCHEWAN SHIFTING TOWARDS MORE BALANCED CONDITIONS
May 3, 2023
EMBARGOED RELEASE:
Saskatchewan reported 1,216 sales in April, down 21 per cent year-over-year and slightly below long-term, 10-year averages. Aligning with seasonal trends, sales and new listings trended up above levels seen earlier this year. Although inventory levels experienced a 4 per cent year-over-year decline and remain over 30 per cent below 10-year trends, the adjustments in sales and new listings have resulted in the months of supply rising to nearly five months.
“Our market continues to struggle with supply and has since the start of the pandemic,” said Association CEO, Chris Guérette. “While inventory challenges remain a concern for us, recent trends are pointing to potential supply relief. Should these trends persist, we may see more balanced conditions play out in the market in the second half of the year.”
The provincial benchmark price reached $323,600 in April, up from $321,400 in March and slightly below prices recorded last April.
“As province-wide figures are showing signs of more balanced conditions, it’s important to keep in mind that there is variation depending on location and price range. Conditions remain exceptionally tight in lower-priced products, while more balanced conditions exist in higher price ranges,” said Guérette. “Higher lending rates have driven more purchasers to seek out lower priced options, while it is proving more difficult for existing homeowners to move up in the market.
# # #
Regional Highlights
Both sales and inventory trends varied across different regions of the province in April. Year-to-date sales levels improved in Melfort, Prince Albert, North Battleford, Yorkton, and Weyburn. Additionally, inventory levels improved over previous months across all regions except Humboldt and Weyburn. That said, most regions are still reporting inventory levels lower than the previous year and below long-term, 10-year averages.
Overall, when considering both sales and inventory levels, some regions of the province are not seeing a shift toward more balanced conditions. Melfort, Prince Albert, Yorkton, and Meadow Lake reported further tightening compared to levels reported last year.
Price Trends
Benchmark prices varied across different regions of the province in April. All regions except Prince Albert and Swift Current posted stable to modest gains in benchmark price when compared to the month prior.
City of Regina
Year-over-year sales activity in Regina slowed for the fourth consecutive month. Despite the decline, sales levels are only slightly below long-term, 10-year averages. Inventory levels remain over 25 per cent below long-term averages, while the months of supply increased to 3.43, up from 2.96 in March.
Regina reported a benchmark price of $311,200 in April, up from $307,100 in March and nearly 5 per cent lower than April 2022.
City of Saskatoon
The City of Saskatoon reported declining year-over-year sales for the fourth consecutive month. However, sales levels remain slightly above long-term, 10-year trends. Inventory challenges persist in Saskatoon, with supply levels nearly 37 per cent below 10-year averages, the lowest levels reported in April since 2008.
Saskatoon reported a benchmark price of $375,600 in April, slightly down from $376,300 in March and 1.4 per cent higher than April 2022.
Source - SRA
SASKATCHEWAN REMAINS RESILIENT AS INVENTORY CHALLENGES CONTINUE
There were 1,213 sales recorded across the province in March, a 20 per cent year-over-year decline. Despite year-over-year sales declines, this level of sales is still stronger than pre-pandemic levels and nearly 10 per cent above long-term, 10-year trends.
New listings decreased by over 17 per cent on a year-over-year basis and remain significantly below the 10-year average. In the first quarter of 2023, properties priced below $400,000 contributed to the largest decline in new listings. A reduction in new listings relative to sales resulted in further year-over-year declines in inventory levels, which remain over 30 per cent below long-term averages.
“Higher lending rates continue to impact what buyers are able to purchase, which is creating tight conditions in the more affordable segment of our housing market,” said Association CEO Chris Guérette. “When paired with declining inventory levels, specifically in homes priced under $300,000, there simply isn’t enough choice for prospective buyers looking in that price range right now.”
The provincial benchmark price reached $321,400 in March, up from $318,500 in February and slightly below prices recorded last March.
“Our market is once again showing its resilience, as we continue to report sales above long-term averages,” said Guérette. “That said, we continue to keep a close eye on supply levels across the province. Saskatchewan is growing at its fastest pace in over 100 years and ensuring that supply matches this growth is crucial to maintaining our affordability advantage.
Regional Highlights
Many regions across the province experienced a decline in sales when compared to last year. The year-over-year declines range from a decline of five per cent in North Battleford, to 34 per cent in Swift Current. Prince Albert, however, reported an eight per cent gain in year-over-year sales.
While North Battleford and Prince Albert did see some quarterly gains in new listings, all regions are reporting new listings that are below long-term averages. The continued decline in new listings has prevented a shift in inventory levels, which remain well below the 10-year average in all regions across the province.
Price Trends
Benchmark prices varied across different regions of the province in March. Year-over-year price declines were reported in Martensville, Meadow Lake, Melfort, Melville, Moose Jaw, North Battleford, Regina, and Yorkton. Meanwhile, all remaining regions posted stable to modest gains.
City of Regina
Year-over-year sales activity in Regina slowed for the third consecutive month. Despite the decline, sales levels are well above the 10-year average. Inventory levels remain over 25 per cent below long-term averages, with most of the decline being driven by homes priced below $300,000.
The months of supply in Regina fell to 2.96 in March, down from 3.86 in February. If conditions remain this tight over the next several months, we could start to see an impact on home prices.
Regina reported a benchmark price of $307,100 in March, slightly below the $310,200 reported in February.
City of Saskatoon
The City of Saskatoon reported declining year-over-year sales for the third consecutive month. That said, sales levels remain consistent with long-term, 10-year averages. Inventory levels remain a significant concern, as the city reports supply levels nearly 37 per cent below long-term averages.
The months of supply in Saskatoon fell to 2.32 in March, down from 3.50 in February. Tight conditions in the Saskatoon market are placing upward pressure on home prices and we expect this trend to continue as inventory challenges persist.
Saskatoon reported a benchmark price of $376,300 in March, slightly above the $372,400 reported in February and over 2 per cent higher than March 2022.
Saskatchewan's 2023-24 Provincial Budget, tabled today by Deputy Premier and Finance Minister Donna Harpauer, has a projected $1.0 billion surplus, driven by an economy that is leading the nation and creating thousands of new jobs.
"Saskatchewan is growing at its fastest pace in more than a century," Harpauer said. This budget is designed to ensure that growth continues and that it's growth that works for everyone."
There are no tax increases and no new taxes included in this budget, helping keep life affordable for Saskatchewan people. When taxes, utilities and housing costs are combined, Saskatchewan is the most affordable place to live in Canada for a family of four.
Saskatchewan's economy is expected to lead all provinces in growth in 2022. Momentum is forecast to continue in 2023 with Saskatchewan achieving the second highest growth according to private sector forecasts. The economy is driven by strong commodity prices, solid job growth, increased private investment and a rebound in crop production from the 2021 drought.
More people than ever are working in Saskatchewan. More than 20,000 full time jobs were created in 2022 and employment is expected to continue to grow this year and over the medium-term.
Strong Finances
The 2023-24 Budget projects a $1.0 billion surplus.
Revenue of $19.7 billion is forecast in the 2023-24 Budget, up $2.5 billion or 14.7 per cent, from last year's budget. The higher revenue forecast is largely due to $9.6 billion in taxation revenue, a $1.5 billion increase over last year with Corporate Income, Personal Income and Provincial Sales Tax revenue reflecting a strong economy.
Non-renewable resource revenue is forecast to be $3.3 billion, up $435 million over last year's budget, largely driven by solid potash and oil price expectations.
"With a growing economy and strong finances in Saskatchewan, our government will pay down up to $1.0 billion in operating debt this fiscal year, reducing interest costs and investing those savings into needed services, programs and capital," Harpauer said.
Including last fiscal year, debt retirement and lower borrowing have generated $117 million in annual interest savings.
Expense in the 2023-24 Budget is forecast to be $18.7 billion, up $1.0 billion or 5.9 per cent, from last year's budget.
Investing in Health Care
"This budget delivers a 6.7 per cent increase to the Ministry of Health to $6.9 billion, strengthening the health care system and taking significant steps to further attract, train and retain doctors, nurses and other key health care professionals in a growing province," Harpauer said.
The 2023-24 Budget includes $98.8 million, an increase of $82.7 million over last year's budget, for the Health Human Resources (HHR) action plan. The plan, funded through the ministries of Health, Advanced Education and Immigration and Career Training, will recruit, train, incentivize and retain health care professionals.
In Health, $55.5 million in this budget, an increase of $44.9 million from last year, will recruit 250 full-time positions and expand part-time positions in rural and remote areas around the province. The budget also includes support for recruiting internationally educated health care workers and for the College of Medicine for new academic and research positions, special residency seats and family medicine seats.
This budget invests $518 million into mental health and addictions programs and services, including a targeted investment of $12.4 million over last year, representing the highest investment ever in Saskatchewan for these programs and services. Mental health and addictions funding now makes up 7.5 per cent of overall health spending.
In Advanced Education, $25.2 million in new funding will expand training programs. Approximately 550 seats will be added across 18 health training programs to help address critical markets. The budget includes $10 million to support the continuation of a 150-seat expansion in nursing programs and $2.4 million to train internationally educated health care providers.
Immigration and Career Training supports the HHR action plan with $5.2 million in this budget to assist with initiatives to fill current vacancies through the licensing of internationally educated health care workers already in Saskatchewan.
This budget includes a $42.5 million increase to fund the largest volume of surgical procedures in the history of the province. 6,000 more surgeries will be performed this year, bringing the total to 103,000 and reducing the waitlist to its pre-pandemic level by March 2024, a year ahead of schedule.
A $39.0 million increase in this budget supports seniors' care and includes a number of important initiatives, including $17.6 million to procure additional long-term care beds in Regina and $9.3 million to support third-party long-term care providers. There is $5.5 million to hire 75 continuing care assistants (CCAs) for the final phase of the three-year $18.4 million government commitment to hire 300 CCAs to deliver home care and support services for seniors living in long-term care facilities.
A $7.0 million increase for more medical imaging, primarily CT and MRI scans, and a $2.6 million increase for more endoscopy procedures are included in this budget to help reduce wait times.
Investing in Education
The 2023-24 Budget includes more than $4.0 billion for Prekindergarten to Grade 12 and post-secondary education.
"More than 189,000 students are attending Kindergarten to Grade 12 in Saskatchewan, the most in more than 20 years," Harpauer said. "Growth that works for everyone means every student receives the best possible education."
In this budget, the Ministry of Education provides record investment of $3.1 billion, an increase of $192.8 million or 6.7 per cent over last year, to support schools, early learning, child care and libraries in a growing province. Saskatchewan's 27 school divisions will receive $2.0 billion in operating funding, an increase of $49.4 million over last year.
There is $23.0 million to support the startup and operation of the new Saskatchewan Distance Learning Corporation - Sask DLC. The new corporation offers more opportunities for students to access a wide variety of online courses from Kindergarten to Grade 12, as well as high school electives. Grade 12 completion and electives will be available to adult students as well.
This budget includes $382.4 million for early learning and child care, an increase of $72.1 million or 23.3 per cent over last year. The funding supports young families in our province, helping make life more affordable. It will reduce child care fees for families of children up to the age of six to $10 per day as of April 1, 2023.
This budget includes $764.8 million for the post-secondary education sector this year, an increase of $24.5 million or 3.3 per cent. It includes $47 million for student supports, a 24 per cent increase from last year due to growing use of the Student Aid Fund and the Saskatchewan Advantage Scholarship. There is also $65 million for the Graduate Retention Program, which provides up to $20,000 in tax credits to post-secondary students who stay and work in Saskatchewan after graduation.
Investing in Social Services and Assistance
"Saskatchewan's growing economy means more people are working in this province and fewer people require income assistance," Harpauer said. "At the same time support is increasing for those who need it. That's growth that works for everyone."
The 2023-24 Budget for social services and assistance is a record $1.7 billion.
This budget includes an additional $26.6 million in benefits to support people with low incomes, families and seniors. There are increases to benefits for Saskatchewan Income Support, Saskatchewan Assured Income for Disability, the Senior's Income Plan, and the Personal Care Home Benefit.
A $13.5 million increase for Social Services community-based service delivery partners is part of Government's total $17.6 million increase for community-based organizations (CBOs) which are also funded through the ministries of Education, Health, Justice and Attorney General and Corrections, Policing and Public Safety.
"CBOs have a critical role in helping create positive outcomes and a better quality of life for Saskatchewan's people who need support and assistance," Harpauer said. "This increase helps organizations address operational pressures and recruit and retain qualified staff."
Investing in the Protection of Persons and Property
The 2023-24 Budget includes over $1.0 billion in investments in public safety and the justice system.
"Operational funding for second stage housing ensures women in dangerous situations can safely leave and stay away from abusive partners," Harpauer said. "This budget includes a new investment of $876,000 over three years to support survivors of interpersonal violence with the expansion of counseling services for clients living in second stage housing."
Over $27.5 million in interpersonal violence supports and services are included in this budget.
The 2023-24 Budget invests in police and law enforcement initiatives, including $7.0 million to establish the new Saskatchewan Marshals Service (SMS) to increase policing capacity within the province, with a focus on rural and remote areas.
When fully operational by mid-to-late 2026, the SMS will have approximately 70 officers, providing an additional law enforcement presence across Saskatchewan, supporting RCMP and municipal police operations were appropriate.
Investing in the economy
The 2023-24 Budget includes a $1.4 million increase to open a trade office in Germany - the fourth largest economy in the world and the economic, financial and manufacturing hub of the European Union. The investment, which is part of the $19.3 million International Trade and Investment Strategy, will advance the province's economic interests abroad. The new office will join existing trade offices in the United Kingdom, United Arab Emirates, Mexico, Vietnam, Japan, India, Singapore and China.
Officials in these offices connect Saskatchewan businesses with investors and customers and provide on the ground support, with knowledge of local business culture, rules and regulations in key markets.
"Those efforts are paying off. Saskatchewan's merchandise exports rose from $37.0 billion in 2021 to $52.4 billion in 2022 - an increase of 41.6 per cent," Harpauer said. "More exports abroad means more jobs here at home. That's growth that works for everyone."
The 2023-24 Budget includes the highest level ever of Municipal Revenue Sharing - $297.9 million, an increase of $35.3 million or 13.4 per cent, from last year's budget. The budget includes $503 million of direct provincial support to municipalities, an increase of $54.5 million or 12.2 per cent over last year's budget, primarily due to higher revenue sharing, the provincial portion of infrastructure funding and a number of grants and initiatives from across government.
The 2023-24 Budget includes $249.1 million in targeted funding for Indigenous and Métis people and organizations, representing an increase of 6.8 per cent from last year.
Investing in Capital for a growing Saskatchewan
Our government continues to build highways, schools, hospitals and other important projects that a growing province needs," Harpauer said. "With a record $3.7 billion included for capital in the 2023-24 Budget and $15.2 billion in planned capital investment over the next four years, that's growth that works for everyone."
The 2023-24 Budget includes $337.6 million for health care capital, an increase of $181.0 million from last year. This includes major ongoing construction at the Prince Albert Victoria Hospital and the Weyburn General Hospital replacement.
This budget invests $442.9 million into transportation capital, including over 1,000 kilometres of improvements on provincial highways. Significant projects include twinning near Rowatt and Corinne on Highways 6 and 39 between Regina and Weyburn and completing passing lanes and widening on Highway 5 from Saskatoon to Highway 2, and planning for construction to extend twinning on Highway 5 east of Saskatoon.
The 2023-24 Budget includes $152.3 million for education capital, largely for five new school capital projects, and support for the ongoing planning and construction of 15 new schools and the renovation of five existing schools.
This budget includes $348.1 million for municipal infrastructure and Crown corporations will invest $2.1 billion into major capital in 2023-24, largely through SaskPower, SaskEnergy and SaskTel for a number of electricity generation, gas transmission and distribution and communication network projects.
"This budget is about more people, more jobs, and more opportunities," Harpauer said. "More doctors, more nurses, and more surgeries. More students, more schools, and more affordable child care. More support for seniors, for young people, and for people with disabilities. Safer families and safer communities. A growing economy, a brighter future, and a growing province whose best days are still ahead."
"That's growth that works for everyone."
According to a new report by RBC Economics, Canada’s housing market correction is slowing down, with a bottom expected to be formed in the coming months
The report predicts a 15 per cent peak-to-trough decline in the national RPS Home Price Index, with roughly half of that decline still to come.
While RBC economists expect the recovery phase to start slowly later this year as affordability issues and a weaker economy continue to hold back buyers, the pace of the recovery should progressively pick up in 2024 once the economy clears its “soft patch,” inflation returns to target, and the Bank of Canada reverses part of the massive rate increases it has imposed since March 2022.
Immigration will continue to fuel demand through the medium term (and possibly beyond), raising the odds of supply shortages if housing starts don’t increase.
The steep slide in home resales, which began in March 2020, ended a two-year market frenzy, but the slowdown has significantly calmed since the fall.
RBC Economics predicts that unless the economy craters, there is little downside left.
Accounting for the growth in housing stock, nationwide resales are the quietest they’ve been since the 2008-2009 global financial crisis, excluding the lockdown period in the spring of 2020.
RBC predicts that some markets, like those in Ontario and possibly Atlantic Canada, might be ahead of the pack in forming a bottom, while others, like those in the Prairies and Quebec, might lag somewhat.
RBC expects that the Bank of Canada’s rate hiking cycle is likely on hold and that January 2023’s 25 basis-point hike was the final strike in a historic campaign that drove the policy rate up by 425 basis points, taking it to 4.5 per cent in less than a year.
RBC believes the interest rate environment will remain restrictive for a while, and the Bank of Canada will abstain from cutting rates until 2024.
Buyers will continue to face steep challenges due to affordability issues, especially in the country’s more expensive markets, with RBC predicting the sharp deterioration in housing affordability since 2021 won’t unwind quickly.
Lingering affordability issues will stand in the way of a quick market rebound and a material easing in buyers’ budget constraints.
Despite the recent swings in the Canadian housing market, analysts suggest that the fundamentals remain solid.
The market’s recent volatility can largely be attributed to the unique circumstances of the global pandemic and exceptionally low interest rates. However, once the market has adjusted to higher interest rates, analysts predict that solid fundamentals will once again come to the fore in 2024.
One key indicator of the strength of the Canadian housing market is the historically low inventory of homes for sale, and “there are no signs of overbuilding virtually anywhere in the country,” RBC reports.
This is particularly noteworthy given the rapid growth of Canada’s population, which has seen its largest increase in generations over the past year and booming immigration is expected to keep this trend going over the medium term.
full report, authored by Robert Hogue
In recent weeks, and although not all segments of the market but we have began to see multiple offers and delayed presentation offers again on some properties.
There were 854 sales recorded across the province in February, a year-over-year decline of 19 per cent. However, while sales are down year-over-year, sales activity remains stronger than pre-pandemic levels and above long-term, 10-year averages.
As seen in prior months, Saskatchewan continues to report new listings and inventory levels significantly below long-term trends. There were 1,360 new listings in February, down 18 per cent year-over-year and nearly 28 per cent below 10-year averages. While the months of supply did push above six months, inventory levels were down 6 per cent year-over-year and 31 per cent below 10-year averages.
“We continue to see higher lending rates and supply challenges contribute to a pullback in sales,” said Association CEO Chris Guérette. “I’m beginning to sound like a broken record, but our biggest concern is still inventory levels, specifically in the more affordable segment of our housing continuum.”
The provincial benchmark price reached $318,500 in February, slightly higher than the $317,400 recorded the month prior and 0.4 percent higher than February 2022.
“Year-over-year sales declines were to be expected as we returned to a more balanced market where sales activity is more consistent with the historical 10-year averages,” said Guérette. “Saskatchewan remains one of the most affordable jurisdictions in the country with a resilient market that is well-positioned for stable demand in home ownership."
City of Regina
Sales activity slowed for the second consecutive month, contributing to a year-to-date decline of 21 per cent. Despite the decline, sales activity remains consistent with long-term trends for this time of year. While both sales and new listings have improved over January levels, the monthly gain in new listings did not change the inventory situation. February inventory levels fell to the lowest level reported for the month since 2013 and the months of supply once again fell below four months.
Regina reported a benchmark price of $310,200 in February, slightly below the $312,200 reported in January but well above the February 2021 price of $295,900.
City of Saskatoon
Sales activity slowed for the second consecutive month, contributing to a year-to-date decline of 19 per cent. Further declines in new listings kept inventory levels 36 per cent below 10-year averages for the month and the months of supply remained under four months.
Saskatoon reported a benchmark price of $372,400 in February, up from $366,000 in January and nearly three per cent higher than this time last year.
SASKATCHEWAN REMAINS RESILIENT, SUPPLY LEVELS A MAJOR CONCERN
Pullbacks in both the attached and detached sectors resulted in 631 sales being recorded across the province in January, a year-over-year decline of nearly 16 per cent. While January sales are lower than the activity reported over the past two years, sales remain consistent with pre-pandemic levels.
Despite gains in new listings, January inventory levels were at their lowest levels reported in over a decade. While inventories did improve in homes priced above $300,000, it had little impact on the low inventory situation that continues to be experienced across the province.
“Rising lending rates paired with ongoing inflationary pressures are impacting what individuals can afford, and our market has struggled to see improvements in supply levels in lower-priced homes,” said Saskatchewan REALTORS® Association CEO Chris Guérette. “Prospective buyers impacted by rate hikes are also faced with less choice in the more affordable segment of our market. Without question, these factors are contributing to a pullback in sales activity.”
Following two consecutive years of price growth, the total residential benchmark price remained relatively stable in January. However, apartment condominiums reported further gains in benchmark prices due to rising demand, relative to supply, in apartment-style products.
“As our market continues to return to pre-pandemic sales levels, it’s important to remember that we typically see fewer transactions occur in January,” said Guérette. “As higher commodity prices and a strong agricultural sector continue to support our economy, Saskatchewan remains resilient and well-positioned for stable demand in home ownership.”
Regional Highlights
Many regions across the province experienced a year-over-year decline in sales, apart from Moose Jaw and North Battleford. Inventory gains in Melfort, Prince Albert, Saskatoon and Yorkton were not enough to offset the declines in other regions, as inventory levels remain far below long-term trends.
While the months of supply have trended towards more balanced conditions across all regions outside of Moose Jaw and North Battleford, all other regions across the province continue to report months of supply lower than 10-year averages.
Price Trends
Year-over-year price gains ranged from a low of just under one per cent in Estevan to a high of over three per cent in Swift Current. Meanwhile, prices eased in Meadow Lake, Melfort, Regina, North Battleford, and Yorkton, with the largest year-over-year price decline occurring in North Battleford.
City of Regina
Regina reported 134 sales in January, slightly below long-term trends for the month. The dip in sales can be attributed to declines in detached activity and ongoing supply issues. With less than 300 new listings this month, January levels are at their lowest level since 2010. Additionally, the pullback in new listings ensured that inventory levels remained well below long-term averages, with much of the inventory decline being driven by homes priced below $300,000.
Regina reported a benchmark price of $312,200 in January, down one per cent compared to January 2022 and above the $291,300 reported in January 2021.
City of Saskatoon
Saskatoon reported 201 sales in January, relatively consistent with long-term trends for the month. While higher lending rates are impacting sales, a lack of new listings and low inventory levels also remain a challenge. New listings eased to 415 in January, the lowest level since 2008 and over 35 per cent below levels typically seen this time of year. As seen in other areas of the province, inventory declines have been mostly concentrated in the more affordable segment of the market.
Saskatoon reported a benchmark price of $366,000 in January, up nearly two per cent compared to January 2022 and above the $336,600 reported in January 2021.
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