Nova Scotia brokers are setting sail for a booming real estate market, following the federal government’s decision to float a $25 billion shipbuilding contract into Halifax harbour.
“I personally was very anxious on the day of the announcement,” James Shinners, head of Mortgage Managers Brokerage Inc., told MortgageBrokerNews.ca. “I felt like a schoolboy about to get his final exam results back. I suspect many of us felt the same way.”
Analysts are projecting that a federal contract for 21 Canadian combat ships -- awarded to the Irving family’s Halifax Shipyard -- will translate into a $10 million shot in the arm for yearly real estate sales. That’s for each of the next 30 years.
“Irving will begin ramping up their hiring and training in mid-2012,” said Shinners, who has also spearheaded development of a training course for Nova Scotia agents. “It is expected that the new contracts, both directly and indirectly, will bring 11,500 jobs to the province by the height of the shipbuilding contract in 2020. A new sense of optimism is being felt by Nova Scotian mortgage brokers.”
Those mortgage professionals will likely benefit in two ways: an increase in purchases driving up funded volumes, but also a spike in home prices well above the typical five per cent annual increases the province has experience since 2007.
That last point means heftier broker commissions in a market where September’s average home price trailed the national average by nearly $100k.
But brokers are likely to face even stiffer competition from the banks, and more specifically, their mobile mortgage specialists, in chasing down that new business.
Halifax brokers, who generally enjoy a larger market share than their counterparts across the rest of the province, are best positioned to take on those aggressive challengers.
Still, Shinners is betting good fortune will eventually spread beyond the Halifax Regional Municipality.
“I believe we will start to see larger property appreciation beyond the typical five per cent per year Halifax has been experiencing,” he told MortgageBrokerNews.ca. “But as property prices increase, along with larger demand, I am hopeful that mortgage brokers across the Atlantic provinces will benefit, not just those in the HRM."