Government Mandates Spark Real Estate Surge in Canada Government Towns
Image by: unsplash
In November, Canadian real estate markets saw a sharp rise in demand following the government's October mandate requiring public sector employees to return to the office. This policy, designed to bolster urban real estate markets, has had a significant impact on government-centric cities like Ottawa, Quebec City, and Victoria, where sales-to-new-listings ratios (SNLR) have surged into tight seller’s market territory. In contrast, larger and more diversified markets like Toronto and Vancouver have shown more modest changes, with Toronto remaining balanced and Vancouver barely crossing into seller’s market conditions.
The SNLR, a key demand metric, reflects the balance between property sales and new listings. A ratio above 60% signals a seller's market with tight inventory and rising prices, while below 40% indicates a buyer's market with excess supply. November’s national SNLR rose to 67.3%, reflecting pent-up demand, credit stimulus, and buyer expectations of potentially lower rates. However, seasonal factors and sudden sentiment shifts could mean the current rally may not persist into spring, especially as broader economic challenges loom.
While most markets tightened, some regions like Saint John, Saguenay, and Calgary saw slight SNLR declines, though all remain in seller’s market territory. Policymakers aim to use urban workforce presence to stabilize downtown real estate values post-2020, but uncertainties around employment and population growth may challenge these efforts. The divergence in market dynamics between smaller government towns and larger, diversified cities highlights the nuanced impact of policy and economic drivers on Canadian real estate.
Read the full article on: BETTER DWELLING
