The capital of Nova Scotia is showing all the signs of an imminent property boom, says a study by Landcorp International. The investment specialist drew the conclusion after looking at the city of St John’s in the neighbouring province of Newfoundland. St John’s has enjoyed dramatic increases in property values over the last 10 years, a surge the report set out to analyse.
It found that the boom had been preceded by massive investment in huge industrial projects in Newfoundland. Projects initiated at this time included, among others, the Hebron Offshore Oil Development, Muskrat Falls Hydroelectric Generation Facility and the Vale Long Harbour Nickel Processing Facility, worth a total of $27.5 billion.
“Fast-forward to 2015 and the results of this investment can be seen. The province’s capital St John’s has witnessed population grown of more than 110 per cent, personal incomes have risen 57 per cent and the average house price has more than doubled,” says Ailse MacFarlane, Managing Director of Landcorp International.
“What’s more, the city continues to experience some of the strongest price growth in the country.”
Now, Landcorp believes history could be about to repeat itself in Nova Scotia. More than $36 billion dollars worth of development is currently underway in the province, in major projects spanning offshore oil and gas exploration, renewable energy and general infrastructure.
Most notable is the naval shipbuilding program that will commence this summer, worth $25 billion. According to Irving Shipbuilding, 3,600 full time equivalent jobs (direct and indirect) have already been created across Canada, while GDP has been boosted by $308 million.
In addition to this is the construction of a major new convention centre, supporting 1,700 jobs, and the $8.3 billion Goldboro LNG liquefied natural gas export project. Final approval of the project will provide jobs for 3,500 people over its four-year construction period.
“In our view, the implications for employment, income and house prices in the province are extremely encouraging. Historically, the real estate market in the Halifax area has shown steady growth, but prices could catch up big-time with other major Canadian cities like Vancouver and Calgary given the economic prospects,” adds MacFarlane.
According to data from The Chronicle Herald (Atlantic Canada’s highest circulation broadsheet), average household incomes in Nova Scotia are 12 per cent above the Canadian national average, yet the cost of real estate in NS is less than half the average price of major cities such as Toronto, Ontario and Vancouver.
However, figures indicate Nova Scotia’s boom has already begun; Royal LePage reports a 2.7 per cent% jump in house prices year-over-year in 2014, while the Canadian Real Estate Association (CREA) predicts home sales in the area will increase by 2.6 per cent in 2015 – the largest increase in Canada.
The Bank of Montreal confirms the positive outlook, forecasting that Nova Scotia will come in ahead of the national average for economic growth in 2015. It expects Nova Scotia’s gross domestic product to grow 1.9 per cent%, up from a 1.6 per cent pace in 2014 – the top growth rate in Atlantic Canada.
“With the commencement of shipbuilding in Halifax and thousands of new jobs we expect to see a dramatic increase in demand for housing in the city,” concludes MacFarlane.
He highlights a four-season luxury leisure resort currently under development in greater Halifax: Forest Lakes Country Club will feature a range of high-end residential units, a five-star boutique hotel and spa, a conference centre and Nova Scotia’s only 18-hole Nicklaus Design golf course. Investments are available from £50,000.