Newfoundland Average Home Prices Move Up To 5th “Lowest” In Canada

Newfoundland home prices have advanced substantially from one year ago.  When comparing average home prices to the end of February 2009 with those of other provinces in Canada, Newfoundland ranks 5^thlowest.  However, statistics from the Canadian Real Estate Association (CREA) show that the average price of a home one year ago placed Newfoundland 3^rd lowest in the country.  Apparently we jumped two places in the last 12 months.  That tells you a bit about our market for home buying in 2008.  It was very competitive.

In the coming years I am expecting continued economic growth in the province.  There are several significant drivers which would impact future values positively.  The development of the Hibernia oil field extensions and the development of the Hebron oil field are new projects that will come in due course. 

The Long Harbour smelter construction project promised by Vale Inco when the Voisey's Bay deal was signed will be a significant stimulus to the Newfoundland economy when start up begins.  The decision to develop the hydromet plant in Long Harbour was announced last fall. 

Then there is the Lower Churchill Hydro development project currently being studied by the NL government.  Should this receive a commitment of the Federal and Provincial governments, it will provide economic stimulus to all of Atlantic Canada. 

As these mega projects are given the green light and come on stream, I believe real estate prices in Newfoundland will grow substantially in the following years.  An investment in real estate in St. John's and the surrounding area would prove to be a safe and productive way to increase ones net worth for the next fifteen to twenty years. 

First time home buyers usually lead the market.  Today, many are working hard to pull together a down a payment to take advantage of the current weakness in list prices and the significantly discounted interest rates offered by the banks.  Because consumer confidence is at an all time low, the Bank of Canada is stimulating the economy with record low interest rates.  It seems logical to conclude that now is a good time to become a real estate owner in Newfoundland.

In summary, I observe that the average home price in Newfoundland has risen substantially in the previous 12 months and that durring this time, Newfoundland has been a very good place to be invested in real estate.  But more importantly, we can be confident that Newfoundland is still one of the most affordable places in Canada to buy real estate and there is plenty of upside opportunity from here.    

R. Greg Osmond is a Platinum Award winning Realtor serving St. John's and surrounding areas, Newfoundland and Labrador for over 20 years and can be reached at 709-895-2500. Visit http://www.rgregosmond.com/for further information. Find him on facebook and be a friend.