There can be no denying that COVID-19 has had a tremendous impact on global and local markets. While the true extent of the pandemic’s effects will not be known for some time, we can begin to get an idea of how markets are being affected. In Saskatchewan, the first presumptive case of COVID-19 appeared on March 12, and the province declared a state of emergency on March 18. Comparing sales and sales volume figures since the state of emergency was declared to the same period last year reveals that while there was a 6.2% drop in total sales and a 9.6% drop in total sales volume, none of this decline affected the residential market.
In fact, the number of residential sales in the province was unchanged while total sales volume increased 5.6%. While reports have suggested that real estate markets in countries hit with COVID-19 have seen the total number of transactions decline significantly, the Saskatchewan real estate market hasn’t been negatively impacted to date. However, what data exist suggests that it takes time for transaction volumes to fall, and as the environment continues to change and markets react to new policy measures, we should expect to see impacts emerge in the future.
"Other markets have seen significant declines in transactions as a result of COVID-19 or other previous pandemics" says Jason Yochim, CEO of the Saskatchewan REALTORS® Association. "While we should expect to see transaction volumes decline in the wake of COVID-19 as well, the combination of low interest rates and declining inventories should make for a strong recovery once this temporary crisis is over."
Sales in Saskatoon were up 6.2%, going from 258 in March 2019 to 274 in March 2020, and up 7.2% in the overall region, going from 346 to 371. In both Saskatoon and the region, sales were less than 2.0% under the 5-year average while they were more than 10% below the 10-year average. Year-to-Date (YTD) sales in Saskatoon rose 8.2% over last year, increasing from 668 to 723, while YTD sales in the larger region also increased 8.8%, going from 891 to 969.
Sales volume was up 16.9% in the city, going from $81.4M to $95.1M in 2020 (1.3% above the 5-year average). YTD sales volume in the city was $240.2M, an increase of 12.6% from last year. In the region, sales volume was up 16.2%, going from $105.9M to $123.1M (1.2% above the 5-year average). YTD sales volume also increased 11.3% in the region, rising from $274.6M in 2019 to $305.7M in 2020.
Although total sales and sales volume were up, the number of new listings in March 2020 fell significantly from the number last year. In Saskatoon, new listings fell 14.2%, going from 702 to 602 (over 17.0% below the 5- and 10-year averages), while in the region the situation was even worse, with new listings falling 19.5% from 1,037 last year to 835 this year. Active listings also fell 9.9% in Saskatoon (down from 1,611 to 1,452) and 7.8% in the region (down from 2,864 to 2,641).
The sales to listing ratio was 45.5% in Saskatoon and 44.4% in the region suggesting somewhat balanced market conditions in the area.
Homes in Saskatoon stayed on the market an average of 55 days in March—down a modest 3.5% from 57 days last year (but still slightly above the 5-year average of 54 days). Homes in the region stayed on the market somewhat longer than homes in the city at 66 days on average in 2020, but also down from an average of 68 days last year.
Average home prices in Saskatoon went from $316,737 to $347,189 (an increase of 9.6%) and were approximately 3.0% above the 5- and 10-year average price. The MLS® Home Price Index (HPI)—a more accurate measure of house price trends—is down 0.3% from $303,200 to $302,200. Average home prices in the region also increased 8.4%, going from $306,161 to $331,793, which is also approximately 3.0% above historical averages.