Nova Scotia's housing market experienced a slowdown in May, with both home sales and new listings declining compared to the previous month, while prices continued their upward trajectory, according to data released by the Nova Scotia Association of Realtors.
Sales and listings drop
The number of homes sold in May fell by 8.5% compared to April, marking the second consecutive monthly decline. New listings also decreased by 6.2%, suggesting that some sellers are holding back amid uncertain market conditions.
Despite the slowdown in activity, the average home price in Nova Scotia rose by 3.1% year-over-year to $412,000, driven largely by strong demand in the Halifax Regional Municipality. The median price increased to $385,000, up 2.7% from the same period last year.
Affordability concerns persist
Market analysts attribute the price increases to a persistent imbalance between supply and demand. Inventory levels remain low, with only 3.2 months of supply available, well below the balanced market threshold of five to six months. This shortage continues to put upward pressure on prices, particularly for single-family homes in desirable urban areas.
"We're seeing a market that is still very competitive for buyers, especially those looking for entry-level homes," said a spokesperson for the association. "Sellers are receiving multiple offers in many cases, which is keeping prices elevated."
Regional variations
The market performance varied across the province. In Halifax, sales were down 7.2% month-over-month, while prices rose 4.5% year-over-year. In Cape Breton, sales fell 12.1%, but prices remained relatively stable. Rural areas experienced smaller declines in sales but saw modest price increases.
Economists warn that the combination of rising interest rates and high prices could further dampen demand in the coming months. The Bank of Canada's recent rate hikes have increased borrowing costs, making it more difficult for some buyers to qualify for mortgages.
Despite the current slowdown, the long-term outlook for Nova Scotia's housing market remains positive, driven by population growth and a strong local economy. However, affordability challenges are likely to persist until supply constraints are addressed.
