'We've been looking for almost a year': Why Sask.'s housing market is red hot

Bidding wars are common in these cities, according to real estate agents, and sellers are less willing to accept conditional offers.

Key takeaways:

Seller’s market: Saskatchewan is currently a seller’s market, and first-time home buyers are struggling. Many buyers are having to bid on multiple homes that end up selling for more than the asking price.
Buyer’s experience: Ruth Aguilar, 25, who has been looking for her first home for nearly a year with her husband, Aaron Gunter, describes a difficult experience. They have bid on three homes, each of which has sold for tens of thousands of dollars (sometimes as much as $50,000) above the asking price. The couple is considering calling it quits in frustration.
Housing inventory is falling: Peter Forlas, a real estate agent in Regina since 2009, says housing inventory has not been this low since the recession. He estimates that housing inventory is 50% lower than it was during the COVID-19 pandemic.
Impact of the COVID-19 pandemic: Jillian Moore, a real estate agent in Saskatoon since 2012, believes the lingering effects of the COVID-19 pandemic are a major reason for this. She notes that during the pandemic, many people either hated their homes or their spouses, which led to a surge in sales. This has doubled the sales trend.
Low interest rates: Forlas also points to the low interest rates in 2021, which many people took advantage of and locked in their mortgages for five-year terms. They don’t want to miss out on these low rates unless they have to relocate for work or find their dream home. She predicts the market won’t change until 2026, when these loans are renewed.
Lack of impact from foreign investors: Both Forlas and Moore acknowledge that while newcomers make up a large buyer base and are struggling in a hot market, foreign buyers buying investment properties are not the main driver of the decline in housing inventory in Regina and Saskatoon. Forlas believes this is not as much of an issue in central Saskatchewan as it is in larger metropolitan areas.
Inventory issue: Moore sees the main driver of the market as “an inventory issue,” saying that to achieve a balanced market, housing inventory needs to triple. In June, there was only 1.6 months of housing supply in Saskatoon and 2.03 months in Regina, while a balanced market requires six months of supply.
Buyer flexibility needed: Both real estate agents emphasize that potential buyers in the current market need to be more flexible about their wants and needs.
Another couple’s experience: Julie Anderson and her partner Matthew Roytt, who are looking to buy their first home in Regina after five years of saving, have had to be flexible about their needs, such as a garage and multiple bedrooms. They have also submitted five offers, some up to $30,000 above the asking price, but have yet to make a purchase.

The above story shows that Saskatchewan’s housing market is highly competitive due to a severe inventory shortage, caused by the effects of the pandemic and low interest rates, and buyers are facing significant challenges.

Source