The Atlantic Maritime province of Prince Edward Island (PEI) continues to attract new residents in search of housing. If you are one of the many individuals considering a home purchase in PEI, you have come to the right place. We are the best site online for those who are looking for low mortgage rates. This is because of the extensive resources we have on the PEI housing market. We provide the best PEI mortgages rates as we shop for the most competitive rates from banks, brokers, and lenders in Canada. Consider the information on the PEI housing market below, and then select the rate that is right for you on this page.
What Influences the PEI Housing Market
The strength of Prince Edward Island’s housing market depends on several factors. The following are the most significant:
• Economy — A strong economy typically goes hand in hand with a strong housing market, and this is as true in PEI as it is in Canada’s other provinces and territories. The good news is that PEI’s economy is expected to grow throughout 2012, however, GDP growth will be a low 1.5 percent. Agriculture should experience the most growth, but a decline in public spending will drag the potential growth rate of the island’s economy down. As a result, unemployment is supposed to remain significantly higher in PEI than in the rest of the country. At 11.6 percent, PEI’s unemployment rate will stay approximately 4 percentage points higher than the national average. Due to economic difficulties, fewer people will be looking to buy a home, and that means you may be able to get a great deal when you buy a house at the lowest mortgage rates in PEI.
• Population — PEI has experienced a larger increase in population than the rest of Atlantic Canada. From 2006—2011, the island’s population grew about 3 percent and now totals more than 140,000 people. Immigration is the main driver of this growth, and all of the new residents in the province will eventually need a place to live. This should drive housing demand for some years to come.
Housing Market Conditions in PEI
Real estate experts are predicting that PEI’s housing market will slow in 2012 and 2013. When it comes to housing starts, for example, there will likely be fewer starts in 2012 than there were in 2011 and fewer starts in 2013 than in 2012. Both single-unit starts and multiple-unit starts will see a decline. Single family detached home starts, for instance, are likely to be no more than 375 in 2012 and 335 in 2013. Even though there has been a slight increase in housing starts in April 2012 over April 2011 (75 vs. 45, respectively), the predicted total yearly housing start figures are not expected to change. Multiple-unit starts are slowing because there are currently more apartments than there are renters, and the vacancy rate is increasing. This is especially true in Charlottetown. Many builders are concerned that the switch to the Harmonized Sales Tax in April 2013 may have a detrimental effect on housing demand, as it will increase the cost of a brand new home.
As far as home sales, there should be a slight decrease over the next couple of years. Experts state that no more than 1,375 homes should sell in 2012, with only 1,300 units selling in 2013. Again, Charlottetown’s housing market is a significant part of this, as the total number of MLS sales in the town should decline approximately 10 percent from 2011 and reach about 475 sales in 2012. Despite the slowdown in sales and starts, however, home prices on the island should remain essentially stable. The average sales price should be around $153,000 in 2012. There will be a modest increase in 2013, which will make the average home cost no more than $155,000. Therefore, you may be able to wait a few more months before you buy a home on the island at affordable current mortgage rates. PEI homeowners, however, will not be content to hold the house of your dreams for you, so if you find a house that you love on the island, it is likely a good idea to snap it up immediately.
Speaking of mortgage rates, the average interest rates on home loans are expected to remain at their historically low levels in 2012. This may even carry over into 2013. In any case, the average rate will fall between 4 and 5 percent for a fixed 1-year mortgage, while the range for a variable 5-year mortgage will be somewhere in the neighborhood of 3.5 and 4 percent.
Buying a Home in Prince Edward Island
Prince Edward Island is not very large in terms of its geographical area, but it has no shortage of cities and towns in which you would want to live. Here are some of the top locations in PEI, including both well-known towns and smaller, often overlooked communities:
• Charlottetown is the most populous city on PEI, and it is also the capital of the province. The economy of this municipality depends heavily on public sector jobs, although there are a number of call centers and other technology-related companies that provide a lot of work in the private sector. Although housing starts will decline throughout 2012, there is still a significant demand for single family homes. The average price for one of these residences is higher than the average price for a home elsewhere in the province. Buyers can expect to pay an average of $189,000 for home in Charlottetown.
• Summerside is the second most populous municipality in the province, and it is an important center economically for the western portion of the island. The closure of an air force base in the area had a significant impact on the economy, but aerospace firms and the public sector are hiring. This may be a good community in which to purchase a home at the affordable mortgage rates in PEI before future demand makes Summerside homes too costly.
• Montague is the largest community on the eastern portion of the island. The population of this town is growing, as many people are arriving to work in the tourism, farming, and fishing industries.
Get The Best PEI Mortgage Rates
You are now prepared to take make an informed buying choice in the PEI real estate market. Choose a mortgage rate on this page or complete the online mortgage application form to speak to a mortgage expert and get access to the lowest mortgage rates in the province.
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