Over the last few years, competition has severely intensified in Charlottetown’s housing market, in turn sharply pushing up housing prices.
According to the Canadian Real Estate Association’s latest data for the city, the average home sales price grew by 38.5% from 2016 to 2019, ending up at $277,000 as of mid-year.
This far outstripped the rate of growth in other major Canadian markets like Ottawa (21.6%) and Toronto (25.3%). The only city that came close was Victoria (33.3%), and the only locales that exceeded the Charlottetown figure were Ontario’s Niagara Region and some sections of Vancouver Island.
Further fuelling the trend is the PEI capital’s rental vacancy rate of 0.2%. This extreme market tightness has provoked bidding wars, a phenomenon hitherto unknown to the province.
“It does happen, no question,” Century 21 and Colonial Realty broker/owner Joel Ives told CBC News.
“People are banging on doors, saying ‘I really like your house, are you interested in selling?’ And some people say ‘yes, maybe we are if the price is right.’”
Scarcity has become particularly apparent in the $250,000 to $350,000 price bracket. Moreover, any new developments that get completed tend to be either starter homes or high-end properties – although this might be changing soon.
“I think as we get some more supply in, that’s going to settle it down a bit more,” Ives stated.
However, the supply is still expected to shift towards more expensive offerings, which will trigger an influx of young households moving to duplexes or semi-detached units.
“It’s always been somewhat of a struggle. Parents have helped children buy houses for generations and that'll continue.”