Contrary to most parts of Canada, the Halifax market appears to be slightly overvalued despite new-home construction “as low as it can possibly go,” a top home builder said.
“The current market is down considerably and assessments are putting downward pressure on pricing, but, quite literally, if they go down much further, we’ll just stop building because you have to make your margins,” said Joseph Daniel, general manager of Cresco Developments Ltd in an interview by the Chronicle Herald
While Daniel admitted he can’t speak for his competitors, he believes they are all in the same boat.
Halifax, he said, has a more-speculative market because most homes are only sold after construction. This is the opposite scenario for high-demand markets of Western Canada where homes are sold before they are built.
Despite this, Cresco continues to build houses, he said.
His comments seem to echo the findings of the Canada Mortgage and Housing Corp. on Monday, which named Halifax as a slightly overvalued housing market.
CMHC said that there has been an increase in the number of completed yet unabsorbed housing units in Halifax recently.
“There is only so much you can do as a builder. What you’re building is essentially dictated … by the land that you’re buying,” Daniel said.
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