Nanaimo Housing Market Outlook (2021)
Nanaimo real estate market in favor of sellers in 2021, prices expected to rise 6.21%
Nanaimo real estate is expected to remain in the seller’s market area in 2021, with expectations for a stable year marked by low interest rates allowing more people to access the property market, as well as steady demand from mainland British Columbia buyers. Low inventory is a common trend in many British Columbia real estate markets and is putting pressure on prices. The average sales price of single family homes in Nanaimo increased to $ 602,905 in 2020 (January 1 – October 31) compared to $ 559,252 in 2019 (January 1 – December 31). The number of single home sales increased by 13.29% to 1,262 in 2020, up from 1,114 in 2019. The RE / MAX outlook for Nanaimo residential real estate in 2021 is a Average price increase by approx. 6.21% to approx. 470,738 USD across all property types with an expected Sales increase of 12% for single-family houses and 3% for condominiums as well as sales decrease of 5% for terraced houses.
Who is driving demand for Nanaimo real estate?
Nanaimo saw an influx of buyers from both Mainland BC and the rest of Canada. Many of these buyers are upscale mainland buyers, and as more people move to Nanaimo each year, this trend is expected to continue through 2021.
First-time buyers in the area tend to be young couples looking for townhouses between $ 400,000 and $ 500,000. First-time visitors who have struggled to buy property are unlikely to find relief in 2021 as price hikes continue to mount. While first-time buyers really didn’t hesitate in 2020, the loss of jobs due to COVID had an impact on their confidence. An improvement in job stability expected in 2021 will result in more first-time buyers entering the market.
Young buyers in the Nanaimo area are typically families. Due to the lack of listings in the Nanaimo market, there was no hesitation from up-and-coming buyers. Demand has led aspiring buyers to buy now and later. Another factor driving aspiring buyers to buy now is the increased cost of new construction due to land values, materials and labor shortages. The criteria that buyers had to buy a new property have shifted, mainly due to COVID-19, to focus more on larger lots and more space. This is expected to be the case over the long term as low interest rates drive demand for real estate in the $ 700,000-1 million range.
Condominiums recorded a 4.44% increase in sales from 2019 to 2020. Some challenges faced by the Nanaimo condominium market in 2020 included a 70 unit decrease in available units compared to 2019. Condominium prices also increased 16.31% year over year due to the lack of supply in the date this sector. This is expected to stay that way until 2021 as supply does not keep pace with demand. With more new builds over the next 6 months, this is expected to result in around 320 condominium sales in 2021.
Nanaimo’s luxury real estate market is powered by moving buyers from mainland BC as well as the rest of Canada. COVID-19 caused prices to rise and demand for luxury homes remained at higher than normal levels due to lower available housing supply. This trend is expected to continue over the long term. Data suggests steady demand for luxury homes in the Nanaimo market.
Nanaimo’s hottest neighborhoods
The top selling Nanaimo neighborhoods in 2020 were North Nanaimo, South Nanaimo, and Departure Bay. This is due to larger properties and waterfront views, and these neighborhoods are closer to amenities such as major shopping centers.
Nanaimo new building
The new home market in Nanaimo is low on inventory, which has resulted in sales prices increasing by 13.29%. Condominium construction appears to be keeping pace with market demands, while single family home construction is occurring more slowly than current demand requires. Brand new homes are more expensive than their resale counterparts, which is influenced by higher land, material and labor costs. Since mid-March 2020, new residential construction has been below the level of 2019 and the 3-year average.
Canadian housing market in 2021
Canadians are on the move. RE / MAX does not call this an “exodus,” but the relocation trend in the Canadian real estate market is real and only one focus of the RE / MAX 2021 Housing Market Outlook Report. RE / MAX Canada expects healthy house price growth at the national level. Moving and moving buyers are continuing to drive activity in many regions of the Canadian real estate market. A persistent and widespread shortage in the supply of apartments is likely to persist, which poses challenges for home buyers and pushes up price pressure.
Because of these factors, the outlook for 2021 RE / MAX 2021 for average home prices across the country is estimated at + 4% to + 6%. Here is the regional breakdown:
Further results of the report are:
- 35% of RE / MAX brokers say buyers from other cities and provinces will continue to trigger market activity in 2021
- 45% of RE / MAX brokers say aspiring buyers are likely to be a major driver of demand in the property market in 2021
- Half of Canadians (53%) are confident that Canadian real estate markets will remain stable in 2021
- 52% of Canadians believe real estate will remain one of the best investment opportunities in 2021
“Despite the tragic effects of the pandemic, our optimism about the strength of the Canadian real estate market has remained,” said Elton Ash, RE / MAX Regional Executive Vice President in Western Canada. “While buyer preferences have shifted significantly this year, we believe factors such as the supply problem, pent-up demand and historically lower interest rates will continue to fuel activity in 2021.”