FP Answers: Where is the best value in Canada for real estate?

By
Millicent Wong
-
0
244
Top stories newsletter logo

  1. property
  2. personal finance
  3. Mortgages & Real Estate
  4. FP replies
  5. First time home buyers

The three cheapest regions in Canada where homes are under $300,000

Publication date:

July 27, 2022 • 5 days ago • 2 minutes read • 32 comments Zoocasa Realty Inc has identified the 10 cheapest regions to buy a home in Canada. Zoocasa Realty Inc has identified the 10 cheapest regions to buy a home in Canada. Photo by Mike Hensen/The London Free Press/Postmedia Network

In an increasingly complex world, the Financial Post should be the first place you look for answers. Our FP Answers initiative puts readers in the driver’s seat: you ask questions and our reporters find answers not just for you, but for all of our readers. Today we’re answering a question from Brian about real estate.

This ad has not yet loaded, but your article continues below.

Canadian real estate has appreciated in value since 2020 as the pandemic, low interest rates and fear of missing out (FOMO) have pushed home prices to record highs and pushed many potential homebuyers out of the market.

Although the Canadian Real Estate Association (CREA) reported June home sales were down 5.6 percent from the previous month, the national median home price was down just 1.8 percent from the same month last year to 665,580, despite rising and tighter interest rates US dollar dropped lending rates today.

Elevated rates in Toronto and Vancouver continue to drive up the high national average, but many smaller neighboring cities offer more affordable rates. You can still find value in real estate if you know exactly where to look.

This ad has not yet loaded, but your article continues below.

Zoocasa Realty Inc. analyzed 25 regional housing markets and ranked each market by its annual growth rate in average home prices. The online broker then determined where the average price ranked compared to the national average and identified the 10 cheapest regions and houses to buy there.

The Saguenay, Que. region tops the list for cheapest housing, with an average home price of $267,353 and a 6.6 percent annual price growth since last June. Newfoundland and Labrador, where the median regional home price is $280,200 with annual growth of 10.8 percent, ranked second. Saint John, NB holds third place with an average home cost of $294,900 and a 30.1 percent annual growth rate.

Zoocasa spokeswoman Patti Cosgarea said she was surprised at how many markets are below the national average. Canadians should continue to see prices fall as the Bank of Canada hikes rates.

This ad has not yet loaded, but your article continues below.

Some people may choose to wait on the sidelines while the market slows amid rising interest rates, CREA chair Jill Oudil said in the association’s June statistics report.

  1. The Calgary Real Estate Board expects real estate prices, excluding the luxury market, to hold up in 2022.

    FP Responses: Will Calgary home prices go down?

  2. none

    FP Responses: When should I take CPP?

  3. Most credit cards have extremely high interest rates - often more than 20 percent - and it's worth looking into alternatives to reduce those rates.

    FP Responses: Should interest rates rise, should we consolidate our debt?

But should potential homebuyers wait for prices to drop even further if a dramatic downturn in the housing market plays out?

Not according to Prof. Jill Grant, who researches housing and cities at Dalhousie University’s School of Planning in Halifax. Grant predicts that housing construction will not return to pre-pandemic levels anytime soon due to a lack of supply.

Canadians are starting more households as families get smaller and more people live alone, and housing supply in Canada hasn’t kept pace with that demand, Grant said.

No one can predict how much interest rates will rise, nor the resulting fall in house prices. But with prices down from their February highs and supply remaining tight, now could be a good time to start buying a new home.

• Email: [email protected] | Twitter: robms4

This ad has not yet loaded, but your article continues below.

By clicking the subscribe button, you agree to receive the above newsletter from Postmedia Network Inc. You can unsubscribe at any time by clicking the unsubscribe link at the bottom of our emails. Postmedia Network Inc | 365 Bloor Street East, Toronto, Ontario, M4W 3L4 | 416-383-2300

Comments

Postmedia strives to maintain a lively but civilized discussion forum and encourages all readers to share their opinions on our articles. Comments may take up to an hour to be moderated before they appear on the site. We ask that you keep your comments relevant and respectful. We’ve turned on email notifications – you’ll now receive an email when you get a reply to your comment, there’s an update on a comment thread you follow, or when a user you follow comments follows. For more information and details on how to customize your email settings, see our Community Guidelines.