House prices in Sask. expected to keep rising: Royal LePage survey

Homes in Saskatchewan’s two biggest cities have been getting more expensive and prices are only going to go higher, according to a Royal LePage house price survey.

The aggregate price of a home in Regina increased 11.8 per cent to $361,200 in the first quarter of 2022. In Saskatoon, the prices are about 10 per cent higher in terms of a sales price for a similar type of house.

Ron Pfeifer, the CEO and co-owner of Royal LePage Regina, says the increase in prices is not a new issue. There doesn’t appear to be any relief in the immediate future.

“What’s been happening in the housing market has been happening for a decade. It’s a low inventory problem,” he said. “There’s a huge problem with builders right now. There’s so much uncertainty in their pricing, they’re afraid to build.

“The two neighbouring provinces and certainly in B.C., their market prices are going up significantly quicker and higher than ours. I believe we’re going to get that push coming from there soon.”

Royal LePage is forecasting the aggregate price of a home in Regina will increase seven per cent in the fourth quarter of the year.

The lack of supply is expected to drive up the price even more thanks to the spring buying season, when people are more likely to be searching for a new home.

“We have low inventory in Regina,” Pfeifer said. “I like to see 1,100 to 1,200 properties on the market. Three and four years ago, we spiked to about 1800. Today, we’re at about 800.”

When it comes to the recent inflation numbers, Pfeifer doesn’t believe it has shown on the housing market yet — but that doesn’t mean it won’t happen.

“Inflation concerns me,” he added. “I made a prediction about a year ago that within an 18- to 24-month period, we would see inflation at seven to 10 per cent and we’d see a 25 per cent increase in Regina prices. I had a lot of people laugh at me, particularly people that are in the industry. I think I’m very close with those numbers.”

There is a silver lining, though: Pfeifer says the prices of homes in Saskatchewan’s biggest cities are still well below the average of other provinces.

“I think in Regina, Saskatoon and a lot of the prairie cities, our prices are still somewhat reasonable compared to the major cities,” he said. “If you want to get into a property here, you can do it pretty easily compared to, let’s say, buying in Toronto. It’s almost impossible (there).”

Nationally, the aggregate price of a home in Canada increased 25.1 per cent year over year to $856,900 in the first quarter of 2022 — the highest gain on record since Royal LePage began tracking aggregate prices.

As strong buyer demand continues to outpace supply in almost every market from coast to coast, the company is forecasting the strong seller’s market conditions to continue this spring.

Ultimately, Royal LePage is forecasting the aggregate price of a home in Canada will increase 15.0 per cent in the fourth quarter of 2022 compared to the same quarter last year.

“There’s no question the homeowner, the fellow that wants to sell his house, is going to do very, very well,” Pfeifer said.