Atlantic Canada’s real estate market in Q3 2024 showed varied activity across residential, rental, industrial, and office sectors. Residential sales and prices rose alongside population growth, while rental rates increased year-over-year despite slight monthly declines. Industrial markets added significant new supply, raising availability rates and average rents. In the office sector, suburban and downtown submarkets displayed differing trends in Fredericton and St. John’s.
Residential Summary for Q3 2024
Sales
Residential sales in Atlantic Canada increased by 3.7% quarter-over-quarter and 4.3% year-over-year.
Listings
New listings rose by 2.4% from Q2 2024 and 7.2% year-over-year. Active listings saw a 2.1% decrease from Q2 2024 but were up 10.1% year-over-year.
Prices
Home prices under construction saw an increase of 1.8% quarter-over-quarter and a notable 28.4% year-over-year.
Months of Inventory
The months of inventory, or the length of time it would take to sell all current listings at the current pace, decreased to 4.5 months in Q3 2024, down from 4.8 months in Q2.
Sales-to-New Listings Ratio
The sales-to-new listings ratio rose from 64.7% in Q2 2024 to 65.5% in Q3, continuing a trend favouring sellers.
Under Construction
Under-construction housing units in Atlantic Canada declined by 4.9% quarter-over-quarter from Q2 to Q3 2024 and by 7.6% year-over-year from Q3 2023 to Q3 2024.
Economic Indicators
Population Growth
The population in Atlantic Canada grew by 0.5% quarter-over-quarter and 2.0% year-over-year, contributing to the sustained demand for housing in the region.
Unemployment Rate
The unemployment rate edged slightly up from 7.6% in Q2 2024 to 7.7% in Q3 2024. This is higher than Canada’s overall unemployment rate of 6.5% as of October.
Mortgage Arrears
Mortgage arrears increased slightly from 0.26% to 0.27% quarter-over-quarter, reflecting a minor uptick in financial strain.
Rental Market for November 2024
Rentals.ca reported that in Halifax, Nova Scotia, the average rent for a one-bedroom unit reached $1,974 in November 2024. This represents a 1.2% decline compared to October but a 5.3% increase year-over-year from November 2023. Similarly, two-bedroom units averaged $2,487, showing a 1.8% decrease month-over-month but strong annual growth of 11.0%.
Industrial Summary for Q3 2024
According to the CBRE, the Halifax industrial market delivered 410,080 square feet of new supply in Q3 2024, adding to the region’s capacity. This influx contributed to an increase in the availability rate, which climbed to 6.7%, the highest since Q3 2020. Average net asking rents rose by $0.66 from the previous quarter to reach $12.02 per square foot, indicating that demand still supports rental growth even amidst rising availability.
Office Market Summary for Q3 2024
Fredericton
The CBRE reported that net asking rents in Fredericton decreased by $0.14 quarter-over-quarter, settling at $15.40 per square foot in Q3 2024. This decline was driven by a $0.33 drop in suburban submarket rents to $15.02 per square foot, while downtown submarket rents fell by $0.03 to $15.70 per square foot.
The overall vacancy rate decreased by 40 basis points to 16.8%, with contrasting trends in submarkets. The suburban vacancy rate dropped by 120 basis points to 18.2% due to strong leasing momentum, which recorded 13,327 square feet of positive net absorption. However, the downtown submarket saw a 30-basis-point increase in vacancy to 15.6%, driven by 7,975 square feet of negative net absorption during the quarter.
St. John’s
Net asking rents in St. John’s rose to $19.58 per square foot in Q3 2024, the highest level since Q2 2022. This increase included a $0.35 rise in suburban submarket rents to $15.67 per square foot, while downtown rents declined by $0.06 to $21.58 per square foot.
Submarket performance was mixed. The suburban submarket recorded 7,950 square feet of positive net absorption, reducing the vacancy rate by 40 basis points to 14.4%. In contrast, the downtown submarket saw 7,700 square feet of negative net absorption, pushing the vacancy rate up by 50 basis points to 28.2%. Sublease availability increased significantly, reaching 8.1% of total market space, with the suburban submarket contributing the most, as sublease space there surged by 540 basis points to 20.2%.