A recent report by Ottawa’s fiscal watchdog revealed that in Halifax, the average house prices are 74% higher than what the typical household can afford. The affordability situation in Halifax has not seen any improvement since the last evaluation in February 2022, according to Louis Perrault, the director of policy. While some cities like Toronto and Hamilton have experienced improved affordability, Halifax stands out among the 11 Canadian cities analyzed in the report with the most significant disparity between house prices and household affordability.
The report noted that during the post-pandemic period, house prices have steadied in some expensive Census Metropolitan Areas (CMAs) but have continued to rise in markets such as Halifax. Umme Sardar, a Halifax Realtor, compared the current housing market in Halifax to the situation in the Greater Toronto Area when she started her career in 2002. She mentioned a shift in the market dynamics in Halifax, particularly in the condo and higher-priced home segments.
Sardar attributed the ongoing price increases in Halifax to the persistent imbalance between demand and supply. Despite efforts by the government to streamline housing starts by reducing bureaucratic hurdles, Sardar believes more actions are necessary to address the housing affordability challenges.
According to the Nova Scotia Association of Realtors, the average selling price of homes in Halifax-Dartmouth surpassed $600,000 in the first nine months of this year, marking a 3.9% increase from the previous year.
The report also highlighted the strain on households in Halifax in terms of mortgage debt service ratios, indicating a significant deterioration compared to over a decade ago. While Halifax’s debt service ratio is concerning, it is comparatively better than other parts of the country, such as Vancouver, where households spend over one-third of their income on mortgage payments for an average home.
In Halifax, the typical household now allocates close to one-fifth of its pre-tax income to mortgage payments to afford an average house, nearly double the ratio observed between 2012 and 2014. Perrault emphasized the worsening affordability situation in Halifax and the need for further measures to address the challenges faced by households.
Overall, the report shines a light on the growing disparity between house prices and household affordability in Halifax, emphasizing the pressing need for comprehensive solutions to ensure housing remains accessible to residents.