Forget Toronto. Buying in P.E.I. increasingly 'cutthroat' as home prices rise

Sarah Dennis and Tristan Gray's kitchen in Charlottetown is feeling cramped these days. Their 10-month old son is crawling around, as their greyhound paces the floor before dinner.The couple has less than 800 square feet of living area.And though they know they could sell their downtown home in a matter of days, alternatives are hard to find; prices in their neighbourhood have skyrocketed since they bought the property in 2017.As part of their home search, they've started pitching themselves in offers to sellers, assuring them they won't convert the property to an Airbnb. They even include a picture of their baby."It's quite common practice now to give a story about yourself and your family in hopes that they'll choose your offer over someone else's," said Dennis."We're trying to say that we're a young family that has expanding needs and is looking for something we can grow into, something where he can make new friends, have a neighbourhood where he can run around and play," said Gray.The number of new homes being built in Charlottetown is a factor in the average selling price. (John Robertson/CBC)The growth in Charlottetown's housing market is far outpacing markets in many other Canadian cities. Data gathered by the Canadian Real Estate Association (CREA) shows house prices have jumped 38.5 per cent in the past three years.Based on the areas CREA normally tracks, only parts of Vancouver Island and Ontario's Niagara region saw faster growth during the same time period. By comparison, prices rose 25.3 per cent in Toronto, 21.6 per cent in Ottawa and 33.3 per cent in Victoria.The latest CREA figures peg the average house price in Charlottetown at $277,000, up from $200,000 three years ago.But a market where buyers get into bidding wars is new for P.E.I., which recently surpassed 153,000 residents. Adding to the housing challenges, the rental vacancy rate in Charlottetown has been hovering around 0.2 per cent.Tourism is one of the Island's primary industries and many downtown homes have been converted into short-term rentals to accommodate them. (Elizabeth McMillan/CBC)In the past decade, the smallest province's population has grown quickly. Thousands of immigrants have moved to the Island and many homes are being converted into short-term rentals for tourists.Realtors say people from other parts of Canada are also buying on the Island, attracted to the relatively lower prices and, in some cases, the investment potential. "It does happen, no question. People are banging on doors, saying 'I really like your house, are you interested in selling?' And some people say 'yes, maybe we are if the price is right,'" said Joel Ives, a real estate broker and the owner of Century 21 and Colonial Realty in Charlottetown. Joel Ives is a real estate broker and owns Century 21 Colonial Realty in Charlottetown. (Steph Clattenburg/CBC)Other factors driving up the average price are sales of high-end, luxury homes and a demand for starter homes that has outpaced the number of new builds, he said. When new homes do go up, they are more expensive than older homes. Properties in the $250,000 to $350,000 range are particularly hard to come by."I think as we get some more supply in, that's going to settle it down a bit more. And it already has," said Ives.With property and infrastructure getting more expensive, Ives predicts young families will have to adapt to moving to semi-detached homes or duplexes — something that is still rare in tree-lined neighbourhoods around Charlottetown."It's always been somewhat of a ...Read more

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