Rising cost of homes pricing people out of St. John's market, says housing advocate
Hope Jamieson, an advocate for affordable housing, says high demand for real estate in St. John's is pricing new homebuyers out of the market. (Garrett Barry/CBC)
A hot housing market in St. John's is expected to continue heating up, leading one affordable housing advocate to worry the average new buyer will be priced out of home ownership.
ReMax's Fall Housing Market Outlook expects average sale prices in the St. John's housing market to go up by 1.5 per cent for the rest of 2024 — an increase that will shut more people out of the housing market, if they're not already in it, according to housing consultant and researcher Hope Jamieson.
The cost of buying a home in St. John's increased by eight per cent over the first seven months of 2024.
ReMax said St. John's is experiencing a seller's market as demand outpaces supply. With fewer listings entering the market, the real estate company is blaming land availability, construction delays due to labour shortages, increased material costs and a lack of new construction for the city's housing shortages.
Currently, the average sale price of a home in St. John's is $363,328.
As prices increase, Jamieson said ReMax's report paints a bleak picture of the real estate landscape.
"Our median income in St. John's is $85,000 in a household. So we're looking at 60 per cent of people who would simply not be able to qualify even to finance a house at that price," they said.
For existing homeowners, a seller's market is good news — but for those entering the market, Jamieson said, the trends make the milestone of buying a first home harder to reach.
The St. John’s metro area is experiencing a seller’s market, with new listings at 3.6 per cent below the region's five-year average, according to ReMax. (Brett Ruskin/CBC)
"If you already own a home, sure, housing prices going up will benefit you specifically, but it does deepen the inequality between people who are already homeowners and people who do not own a home," Jamieson said.
"If we have an eight per cent increase year over year, over about a 10-year period. We're looking at doubled housing prices.… No one's income is going to double in 10 years."
Jamieson wants to see an increase in the supply of affordable housing. Despite costs continuing to rise, they are sensing hope in people through their research.
"There is a new and different appetite to have some real attention on this issue in a way that I haven't seen prior to the last couple of years, which is heartening," they said.
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