While every sector of the economy is feeling the pinch from the coronavirus pandemic, housing prices in Saskatchewan have remained stable.
However, the Canada Mortgage and Housing Corporation (CMHC) thinks that’s about to change.
“There will be a big temporary negative shock. But I think the underlying dynamics over the long term will remain the same,” said deputy chief economist Aled ab Iorwerth.
The Crown corporation is projecting housing prices across the country to be hit between nine and 18 per cent.
But that falls to 25 per cent in provinces like Saskatchewan and Alberta who are also feeling effects from the drop in oil prices.
“Obviously if energy prices come back quickly, then that rebound could happen. But at the moment, we’re just being very prudent and trying to wait and see what will happen,” ab Iorwerth said.
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However, the Saskatchewan Realtors Association (SRA) doesn’t expect the same trend.
Its chief executive is projecting about 80 per cent of sales this May compared to May 2019 and has only seen a drop of one per cent in prices over the last three months.
“A lot of economists like CMHC have accurately predicted five of the last three recessions. So the advice I would give to consumers is contact one of our realtor members. They’re professionals. They know the industry,” Jason Yochim said.
He said making sure the real estate market stays stable should be a priority for governments.
Yochim added the average sale of a home in Saskatchewan has about $54,000 of economic spin-off.
“And that’s all very important to get the economy started again. So if you want a quick shot in the arm, that’s a great place to start with real estate transactions,” he said.
The CMHC said a number of factors could change this outlook, but it added Canada’s housing markets could start to rebound by the middle of next year.
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