Halifax Housing Market in Focus: Rising Rents Amid Population Boom in Nova Scotia
Jun 25, 2024Rising Rental Prices in Nova Scotia
As housing markets across Canada experience unprecedented shifts, recent developments have brought relief and new challenges to those seeking homes. Those seeking a mortgage to purchase a home received a modest reprieve for the first time since 2020 when the Bank of Canada announced a minor reduction in its key interest rate earlier this month. However, renters are not experiencing similar relief. According to a recent report from Rentals.ca and Urbanation, the average asking price for rentals in Nova Scotia has reached a historic peak, driven by a significant population increase in Halifax.
- Average rental asking price in Nova Scotia: 17.1% increase year-over-year
- National average increase: 9.3%
- Halifax one-bedroom apartments: $1,925 (3.8% increase)
- Halifax two-bedroom units: $2,489 (16.3% increase)
These rising rental costs are an increasing burden on residents, making it challenging for many to afford housing in the city.
Population Growth in Halifax and Nova Scotia
This surge in rental prices comes amidst a backdrop of rapid population growth in the Halifax Regional Municipality. Last year, over 20,000 new residents moved to the area, pushing the population close to 500,000. Nova Scotia has only recently reached a provincial population of one million, a significant milestone highlighting the region’s rapid growth. However, this population boom has left the province unprepared. The sudden influx of new residents has exacerbated the housing shortage, leading to tighter competition for available units and increasing prices.
“The estimates vary, but an average unit will house 2.1 people,” noted Halifax Councilor Waye Mason. “This means we need between 20,000 and 30,000 new units.” The significant shortfall in available housing units underscores the urgency of expanding the housing supply to accommodate the growing population.
The vacancy rate in Nova Scotia has remained critically low at one percent for nearly four years and has been under two percent since 2017. In contrast, the commercial vacancy rate stands significantly higher at 15 percent. This discrepancy highlights a potential solution to the housing crisis: converting vacant commercial spaces into residential units. Such conversions could provide a much-needed increase in housing availability without the extensive timelines required for new construction.
The economic situation, particularly since the COVID-19 pandemic, has further strained the housing market. The pandemic triggered a range of economic disruptions, including job losses and shifts in housing demand, which have contributed to the rapid rent increase. Many people relocated from larger cities to places like Nova Scotia in search of more space and a better quality of life, driving up demand for housing in the region.
Nova Scotia Quarterly Population Estimates as of April 1, 2023. This chart illustrates the significant rise in Nova Scotia’s population from 2013 to 2023, highlighting the impact of recent demographic trends and increased migration. This surge in population has intensified the demand for housing, contributing to the current market pressures. Nova Scotia Finance and Treasury Board. For the complete report, visit Nova Scotia Finance and Treasury Board.
Addressing the Housing Shortage
In response to these challenges, the Halifax Council is considering introducing incentives for developers undertaking such conversions. This aims to increase housing availability and address the pressing demand. These incentives could include tax breaks, expedited permitting processes, or financial assistance for renovation projects, all designed to encourage the transformation of underutilized commercial properties into livable residential spaces.
Converting Commercial Spaces to Residential Units
In addition to these efforts, Halifax MP Andy Fillmore has been actively advocating for the relocation of Canada Post’s Almon Street sorting facility. The 5.7-hectare site, situated in a prime area near essential amenities such as grocery stores, pharmacies, schools, and parks, is a crucial opportunity for housing development. The city estimates that redeveloping this land could yield up to 5,000 housing units, with 2,000 units potentially located on the Canada Post site alone.
Redevelopment of the Almon Street Canada Post Sorting Facility
The Almon Street facility is ideally located and equipped with necessary infrastructure like wiring and sidewalks. This would make the development process smoother and more cost-effective. Transforming this site into residential housing would significantly relieve the current housing crisis, contributing substantially to the urban core’s housing stock. Although formal discussions with Canada Post have yet to begin, plans are in motion to initiate these conversations. This strategic move aims to unlock the potential of this prime real estate, supporting Halifax’s growing urban population and addressing the critical need for more housing units.
By pursuing these multi-faceted strategies, Halifax aims to tackle the housing shortage from several angles, leveraging both new construction and innovative redevelopment to meet the needs of its expanding population. Rapid population growth and economic challenges post-pandemic, have necessitated urgent and comprehensive action to ensure that housing availability keeps pace with demand, stabilizing the rental market and providing affordable living options for all residents.
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