Halifax Index 2023

Real Estate

Real Estate

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REAL ESTATE MARKET REMAINS HOT

Halifax’s average home price in 2022 was $541,790, 16.1% above the average price in 2021. It was the second-largest annual price increase in Halifax’s history and the largest across benchmark cities in 2022. However, both housing starts and completions saw tremendous growth, 19.7% and 22.5% above their respective 10-year averages.

The average monthly apartment rent in Halifax grew 8.4% to $1,352. Although this was the highest average Halifax has ever seen, there were four other benchmark cities with higher average rents. The average vacancy rate in Halifax, at 1.0%, was the second lowest across benchmark cities. As of December 2022, there were close to 6,000 apartment units under construction, which will help to bring the rate down in 2023.

The average mortgage delinquency rate dropped to a historic low in 2022 at 0.13%. However, the average monthly payment on a new mortgage jumped by 19.2% between 2021 and 2022 primarily due to higher interest rates. Mortgages continue to be the largest source of outstanding debt in Halifax making up 67.2% of total debts in 2022.

Investment in non-residential real estate in Halifax did not lose momentum in 2022. All three categories of non-residential construction – commercial (+65.2%), industrial (+79.0%), and institutional and governmental (+35.2%) – recorded increases in investment. Average rents for both office space (in downtown and suburban Halifax) and industrial space increased while overall vacancy rates declined for both.

Halifax Index 2023
Housing

Although down from 2021, 2022 still was a historically strong year for housing starts in Halifax at 3,387. At 3,061, completions were at their highest annual level since 2013. Starts and completions were 19.7% and 22.5% higher than their respective 10-year averages.

Single-unit housing starts primarily took place in the area defined by the Canada Mortgage and Housing Corporation (CMHC) as the Rest of Halifax, which includes areas outside the Peninsula, Mainland Halifax, Dartmouth, and Bedford/Sackville. In contrast, most multi-unit starts took place on the Peninsula. Looking at long-term location trends, single-unit starts are increasingly occurring outside what currently would be considered urban and suburban Halifax and multi-unit starts are becoming more dispersed.

Halifax’s average home price increased by a whopping 16.1% in 2022 although still 10.2 percentage points below the 26.3% increase in 2021. These were the two highest growth rates in Halifax’s history and were the highest across benchmark cities. All benchmark cities saw growth in their average home prices. Despite this increase, at $541,790, the average price in Halifax was the fourth lowest across benchmark cities.

According to the 2021 Census, 6.6% of Halifax’s homes needed major repairs. The share was unchanged from 2016, but the actual number of homes needing repairs increased by 1,715.

Source: Canada Mortgage and Housing Corporation, Housing Market Information Portal

Housing Starts and Completions

  • There were 3,387 housing starts in 2022 across Halifax. This is the second highest number of starts ever recorded after 3,794 starts in 2021.
  • Total starts in 2022 were 19.7% (557 units) above the 10-year average.
  • Completions also recorded the second highest number in history at 3,061, second only to 3,357 in 2013.
  • Total completions were 22.5% (562 units) above the 10-year average.

Source: Canada Mortgage and Housing Corporation, Housing Market Information Portal

Single-Unit Housing Starts by Region

  • Halifax had 775 single-unit starts in 2022. This is approximately 50 units above the 10-year average.
  • 2022 saw almost 90% (691 starts) of Halifax’s single-unit starts occurring in the Rest of Halifax region, which is defined by the CMHC as areas outside the Peninsula, Mainland Halifax, Dartmouth, and Bedford/Sackville.
  • Bedford/Sackville saw 28 starts while Mainland Halifax and Dartmouth had 23 starts each. The Peninsula was home to 10 single-unit starts.
  • The number of single-unit starts on the Peninsula has historically been low, but there has been a noticeable decline in the starts taking place in Mainland Halifax, Dartmouth, and Bedford/Sackville especially since the start of the pandemic.

Source: Canada Mortgage and Housing Corporation, Housing Market Information Portal

Multi-Unit Housing Starts by Region

  • There were 2,612 multi-unit starts in 2022 across Halifax, the second most after 2021. This was approximately 500 units above the 10-year average.
  • Most multi-unit starts were located on the Peninsula (984 starts) followed by Rest of Halifax (748 starts), Mainland (455 starts), Dartmouth (419 starts), and Bedford/Sackville (6 starts).
  • The six starts in Bedford/Sackville marked the lowest level of multi-unit starts on record for the area.

Source: Canadian Real Estate Association, MLS® Housing Price Index

Average Home Prices by City

  • The average home price in Halifax in 2022 was 541,790, 16.1% higher than the average of $466,575 in 2021.
  • Across benchmark cities, Halifax had the fourth most affordable average price.
  • The average home in Halifax cost $201,724 more than its counterpart in St. John’s, where the average was the lowest, and $1.6 million less than in Vancouver, which had the highest average.

Source: Nova Scotia Association of Realtors (NSAR), Custom Request

Average Home Prices

  • Halifax’s average home price grew by 16.1% in 2022. Since 2013, Halifax has seen a compound annual growth rate (CAGR) of 7.8%.
  • While the 16.1% growth in the average home price from 2021 to 2022 was dramatic, it was less than the 26.3% jump between 2020 and 2021.
  • The slowing pace of growth in pricing last year follows the Bank of Canada’s rapid interest-rate increases throughout the year. Home-sales activity in 2022 was 26.2% lower than in 2021, the total dollar volume decreased 14.1%, and new listings fell by 11.9%.

Source: : Statistics Canada, Census of Canada (Various)

Share of Homes Needing Major Repairs

  • According to the 2021 Census, the share of homes needing major repairs in Halifax, at 6.6%, did not change from 2016. In absolute terms, there were 1,715 more Halifax homes in need of major repairs in 2021 than in 2016.
  • All other benchmark cities except Montreal and Calgary saw the share of homes needing major repairs decline.

Halifax Index 2023
Renting

Rising home prices in Halifax over the past two years forced many would-be home buyers to rent instead, thereby driving up demand and prices in a rental market already under pressure from record growth in immigration and interprovincial migration. However, Halifax was able to expand its rental supply by 2.6%, so the vacancy rate remained at 1.0% for the second straight year in 2022. As of December 2022, there were 5,840 more apartment units under construction, which will help to relieve strain on the market once completed.

Average rent increased by a record 8.4% in 2022 to $1,352 per month. No region within Halifax was immune to rent increases; the Rest of Halifax and Mainland saw growth of 15.9% and 11.2%, respectively. Rest of Halifax also had the highest average rent per month at $1,648 followed by the Peninsula at $1,409.

Although vacancy rates were the second lowest in Halifax across benchmark cities, there were four cities with average rents higher than in Halifax. Halifax’s average was $323 below the highest seen in Vancouver and $404 more than the lowest in Quebec City.

Source: Canada Mortgage and Housing Corporation, Housing Market Information Portal

Residential Rent and Vacancy Rates

  • The 2022 apartment vacancy rate in Halifax remained unchanged from 2021 at 1.0% and tied for the lowest rate on record along with 2019.
  • The average rent in Halifax was $1,352 in 2022 up 8.4% from the previous year. This is the largest annual growth rate on record for Halifax.
  • Average rent has increased $438 over the last decade with a compound annual growth rate of 4.4%.

Source: Canada Mortgage and Housing Corporation, Rental Market Report (Various)

Average Rent by Region

  • Every region of Halifax saw an annual increase in average rent in 2022. The Rest of Halifax saw the largest growth (15.9%) followed by Mainland (11.2%).
  • The region defined as Rest of Halifax had the highest average monthly rent ($1,648) across the municipality, likely due to lower inventory of apartments in the area. The Peninsula and Bedford/Sackville had average rents of $1,409 and $1,395, the second and third highest across regions, respectively.
  • Dartmouth was the region with the lowest rent in Halifax with an average of $1,161. This represents growth of 2.7% over 2021, the smallest increase in rent across regions.

Source: Canada Mortgage and Housing Corporation, Rental Market Report (2022)

Comparative Rent and Vacancy Rates

  • Among benchmark cities, Halifax’s average rent was in the middle of pack in 2022, at $1,352. This is $323 lower than the highest figure (Vancouver) and $404 above the lowest average (Quebec City).
  • Across benchmark cities, Halifax’s vacancy rate was the second lowest at 1.0%, 0.1 percentage points above Vancouver’s 0.9%. The highest vacancy rate was in St. John’s at 3.0%.

Source: Canada Mortgage and Housing Corporation, Rental Market Report (2022)

Comparative Rent by Apartment Size

  • At $990 per month, Halifax’s bachelor apartments were the fifth most expensive across benchmark cities. The most expensive bachelors were in Vancouver ($1,378). In fact, Vancouver topped the price list for every apartment type.
  • Across benchmark cities, 1- and 2-bedroom apartments were the sixth most expensive in Halifax, at $1,156 and $1,449, respectively. St. John’s ($851) had the least expensive 1-bedroom and Quebec City the least expensive 2-bedroom ($976).
  • Three+ bedroom apartments cost an average of $1,690 in Halifax, the fourth highest across benchmark cities and $635 more than in St. John’s, which was the lowest on the list.

Halifax Index 2023
Mortgages

Despite rising interest rates, the mortgage delinquency rate in Halifax showed no signs of increasing in 2022. In fact, it declined by 0.06 percentage points between 2021 and 2022 to reach 0.13%. The 2022 mortgage delinquency rate is the lowest on record.

Halifax ranked fifth lowest across benchmark cities for the average monthly payment on a new mortgage at $1,533 in 2022. This was $247 (19.2%) over 2021, the largest annual increase going back to 2012.

Mortgages comprised 67.2% of all outstanding consumer debt in Halifax in 2022. This share was slightly higher than in previous years. Consequently, the largest share of monthly payments due across all debt types was also for mortgages at 47.5%.

Home equity line of credits (HELOC), lines of credit, auto loans, and credit cards made up a combined 22.5% of total outstanding debt. The remainder was sourced to all other credit types.

Source: Canada Mortgage and Housing Corporation, Mortgage and Debt Data (Various)

Mortgage Delinquency Rate

  • The mortgage delinquency rate did not increase across any benchmark city in 2022.
  • Halifax’s delinquency rate was 0.13%, the lowest on record. This was down from 0.19% in 2021.
  • Across benchmark cities, Halifax experienced the largest decline in delinquency rates since 2016 when it topped the list with a rate of 0.53%. Between 2016 and 2022, the rate declined 0.40 percentage points.

Source: Canada Mortgage and Housing Corporation, Mortgage and Debt Data (Various)

Average Monthly Payment for New Mortgages

  • In terms of monthly mortgage payments, Halifax averaged $1,533 in 2022. This is the highest on record and an increase of $247 from 2021.
  • Comparing average payments across benchmark cities, Halifax was fifth lowest, $1,135 lower than in Vancouver, the city with the highest average, and $498 more than in Quebec City, with the lowest average.
  • Over the past decade, average new mortgage payments increased 36.5% (+$410) in Halifax, which is the sixth highest across benchmark cities.

*Home Equity Line of Credit.

Source: Canada Mortgage and Housing Corporation, Mortgage and Debt Data (Q4 2022)

Outstanding Debt and Payments by Source

  • As of 2022, mortgages comprised the majority of outstanding debt in Halifax at 67.2%. The share was up from 66.0% in 2021. Compared to pre-pandemic figures (2019), the share was up 3.9 percentage points.
  • HELOCs (8.6%), lines of credit (3.8%), auto loans (4.3%), and credit cards (5.8%) made up a combined 22.5% of total outstanding debt, and all other credit made up a little over 10 percent. All these shares were down from the previous year.
  • Looking at monthly payments due by credit type, mortgages again formed the largest share (47.5%) followed by all other credit (20.2%).

Halifax Index 2023
Non-Residential

The fear that non-residential construction would lose momentum in 2022 sector due to rising input costs did not materialize in Halifax: the city recorded its highest ever investment in these buildings. All three categories of non-residential construction – commercial (+65.2%), industrial (+79.0%), and institutional and governmental (+35.2%) – recorded increases in investment.

Along with these increases in investment, increases in the total value of building permits grew by 3.5%. A total of $164.5 million worth of permits were issued for the construction of new non-residential buildings and a further $182.9 million for improvements to existing buildings.

Downtown Halifax saw office vacancy rates drop to 19.4% from 20.0% in 2021. The rate in suburban Halifax, at 12.9%, was up slightly from 2021 but similar to the average over the past five years. The pandemic trend of falling vacancies in suburban Halifax and rising vacancies downtown reversed in 2022. Average per square foot (psf) office rent, however, continued to grow in 2022. Both downtown ($16.59 psf) and suburban ($14.65 psf) rents in Halifax reached or neared their highest recorded values.

Conversely, the industrial vacancy rate in Halifax continued to fall reaching 1.9% in 2022, the lowest level since recordkeeping began. The average rent jumped to a new high of $8.87 psf. Retail rents in Halifax’s key urban areas ranged from a low of $36 psf to a high of $75 psf in 2022. Ranges vary significantly across benchmark cities: Vancouver has a range of $240 psf between its high and low while and Winnipeg has a range of only $15 psf.

Source: Statistics Canada, Investment in Construction, Table 34-10-0175-01

Investment in Non-Residential Building Construction

  • After falling 10.4% in 2021, total investment in non-residential building construction increased by 63.4% in 2022.
  • Investment in the construction of commercial buildings grew 65.2% over 2021, an increase of $133.8 million.
  • Valued at $82.3 million in 2022, investment in industrial building construction was $36.3 million higher (+79.0%) than in 2021.
  • Investment in institutional and governmental buildings saw the smallest annual increase among the three categories growing by 35.2% (+$13.5 million).

Source: Statistics Canada, Building Permits, Table 34-10-0066-01

Non-Residential Building Permits by Type of Work

  • After increasing 39.8% in 2021, the value of non-residential building permits increased again in 2022 though by only 3.5% and hit a record high of $347.7 million.
  • Of all permits issued in 2022, $182.9 million (52.6%) were for improvements to existing infrastructure and $164.5 million (47.3%) were for new construction.

Source: CBRE, Office MarketView (Various)

Office Rent and Vacancy Rates by Region

  • The 2022 vacancy rate for downtown Halifax office space was 19.4% down 0.6 percentage points from 2021. This rate has been reasonably steady since 2018.
  • The vacancy rate for office space in suburban Halifax increased to 12.9% in 2022 up 0.3 percentage points from 2021.
  • The average net rent for downtown offices in 2022 was $16.59 psf up $0.29 from 2021.
  • Average office rent in suburban Halifax increased to $14.65 psf in 2022 up $0.76 from 2021.

Source: CBRE, Industrial MarketView (Various)

Industrial Rent and Vacancy Rates by Region

  • The industrial vacancy rate continued to plummet falling from a high of 11.7% in 2016 to 1.9% in 2022. Halifax’s industrial vacancy rate is at its lowest ever.
  • Average rent climbed to a new high of $8.87 psf in 2022, $0.55 more than the previous year. This was the largest single year increase in average industrial rent on record.
  • There were projects totaling close to 450,000 sq. ft. under construction in 2022. Another 800,000 sq. ft. are planned to commence in 2023.

*Data are not available for St. John’s and Quebec City.

Source: CBRE, Retail MarketView (H2 2022)

Retail Rent Range by Key Urban Areas

  • Information on retail rent prices in 2022 were published by CBRE for eight of Halifax’s 10 benchmark cities.
  • The high ends of these ranges for Canada’s three largest cities were substantially above the others. The high end of Halifax’s range, at $75 psf, was similar to Calgary, but above Ottawa, KCW, and Winnipeg.
  • At the lowest ends of their ranges, Toronto and Vancouver rents were above Halifax’s average of $56 psf.

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