Real estate markets, including in Prince Albert, are continuing to improve, the Saskatchewan Realtors Association (SRA) said Thursday.
The association sent out their monthly home sales data report, which showed more houses selling for more money after spending less time on the market.
The latest data showed the sales volume in the city up 51.5 per cent compared to last May, rising from $8.2 million to $12.5 million. The sales volume in the greater Prince Albert region rose by even more.
Year-to-date sales are up 100 per cent in the city, and 115 per cent in the region.
The data also shows a 17 per cent decrease in the average time homes stay on the market. At this time last year, most homes were on the market for 90 days. Now, that’s down to 75. The five-year average is 78.
At the same time, the HPI (Home Price Index) benchmark, which measures the average price of a single-family home, rose by 15 per cent from $163,400 last May to $188,100 now. That’s a few thousand dollars above the five-year average, and almost $10,000 higher than the ten-year average.
Regionally, the median home price is up 21 per cent year-over-year, and is sitting at about seven per cent above the five and ten-year averages.
Still, the city’s HPI remains on the low side in the province, with only Melville reporting a lower HPI benchmark price. The HPI is only available for 15 of the province’s 24 realty geographies. May’s report shows 13 of those 15 cities and towns with an HPI increase.
Other jurisdictions, including regional data, use the median price instead. The Prince Albert area’s median home price is in the middle of the pack, sitting far below Regina and Saskatoon and areas, but above smaller regions and communities.
In all, 23 of 24 jurisdictions saw their median home price rise in May 2021.
Strong demand with falling inventory levels means prices continue to rise, the SRA said.
“Markets have been gaining momentum since last May when some pandemic restrictions were lifted,” said Chris Gbekorbu, SRA’s Economic Analyst.
“At some point, things need to start to steady,” he continued, though the SRA report noted that market indicators seem to point to the current pace holding.
It’s unclear what effect, if any, new mortgage rules will have on the housing market. Last time borrowing regulations were tightened, sales and prices fell just over one per cent, but then continued to grow.
The new mortgage stress test rules come into effect June 1. The minimum qualifying rate for uninsured mortgages, which are those with a down payment of 20 per cent or more, will rise to either the contracted rate plus two percentage points or 5.25 per cent, whichever is higher.
Currently, any buyer whose down payment is at least 20 per cent of the purchase price has to show they can afford payments if the interest rate was two percentage points higher than what the bank is offering or the five-year benchmark rate of 4.79 per cent, whichever is higher.
The rules will also apply to mortgages with a down payment of less than 2- per cent.
In a press release, the Office of the Superintendent of Financial Institutions said the rate will support financial resilience should economic circumstances change.
“In a complicated and sometimes volatile housing market, the need for sound mortgage underwriting cannot be underestimated,” they said.