Are you looking to buy a home in Newfoundland & Labrador soon? If so, it would be in your best interests to do some research on the average price of homes in the province.
Given the cost of a home purchase, you’ll want to find out what the going price is for a property in the area you plan to buy in, as well as have your finances lined up to ensure that you can comfortably afford the hefty price tag.
Let’s take a closer look at the current average home price in Newfoundland & Labrador, as well as what you should do to avoid becoming house poor.
Average House Price In Newfoundland & Labrador 2024
In Newfoundland & Labrador, the average home price is currently $291,300, as of November 2023. That’s a 4.0% increase from the same the year before when the average price for a home across the province was $280,200.
Comparing Average House Prices By Province 2024
| Home Prices 2024 | Year-Over-Year % Change | |
| Canada | $646,134 | 2.0% |
| Newfoundland and Labrador* | $291,300 | 4.0% |
| British Columbia | $964,371 | 6.6% |
| Alberta | $446,919 | 5.9% |
| Saskatchewan* | $324,400 | 1.9% |
| Manitoba | $328,654 | -0.7% |
| Ontario | $833,525 | 0.6% |
| Quebec | $485,407 | 3.9% |
| New Brunswick* | $287,900 | 7.1% |
| Nova Scotia* | $390,000 | 5.8% |
| Prince Edward Island | $361,800 | 3.6% |
*based on MLS HPI benchmark prices
Do You Need A Good Credit Score To Get A Mortgage In Newfoundland And Labrador?
Your credit score is one of the many factors lenders take into account when determining your eligibility for a mortgage. Lenders may not be comfortable loaning out money in the form of a mortgage to someone who may have a history of missed or late bill payments.
With a strong credit score, you stand a much higher chance of getting approved and securing a lower interest rate, which can bring your mortgage payments down.
What Affects The Average House Price In Newfoundland And Labrador?
Sellers cannot just arbitrarily pick a listing price and expect buyers to give them what they’re asking if the figure is not in line with the current market. While they technically have the freedom to list at whatever price point they want, they’ll likely have very little success finding a buyer who is willing to pay far more than what the property is worth.
So, how are home prices determined?
Historical Sales
To determine what an accurate listing price is, sellers must take a close look at historical sales in their neighbourhood.
Real estate agents will look at homes that have sold in the past to come up with a listing price. More specifically, the properties that make this list meet the following criteria:
- They sold within the recent past (no further back than 3 to 6 months earlier)
- They are very similar to the subject properties (ie. same number of bedrooms and bathrooms, same type of dwelling, etc)
- They are located in the same neighbourhood (ideally on the same street)
Adjustments And Comparisons To Historical Sales
Based on the price at which similar homes in the neighbourhood have recently sold, real estate professionals will make comparisons to the subject property and will make adjustments as needed until they come to an accurate listing price that’s reflective of the current market.
Adjustments involve adding to and subtracting from the sale price of a similar property. These additions and subtractions will based on several factors and features, including the following:
- Type of dwelling (detached, semi-detached, two-story, bungalow, etc)
- Number of bedrooms
- Number of bathrooms
- Lot size
- Location within the neighbourhood
- Size of the home
- Age and condition of the home
- Layout
- Finished basement
- Parking
- View (for condos)
- School district
Ideally, the subject property will be as close as possible to the comparable properties as possible based on the above factors. This will make arriving at a listing price much easier and more streamlined.
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How To Avoid Becoming “House Poor” In Newfoundland And Labrador
What does it mean to be “house poor,” exactly? The term refers to a situation whereby a large portion of your income is spent on home ownership, including mortgage payments, utility bills, home insurance, property taxes, and maintenance. When you’re house poor, you have very little money left over to spend on other things, including saving up for retirement.
This is not the scenario that you want to find yourself in. Unfortunately, buying a home that’s a little too expensive for your budget can land you in this position. So, how can you avoid becoming house poor?
Understand The Full Cost Of Homeownership
To make sure your income isn’t stretched to the limits after buying a home, it’s important to make sure that your mortgage payments are well within your budget. Even if your lender approves you for a certain loan amount, that doesn’t necessarily mean that you should take out that entire amount.
Ideally, your mortgage payments should take up no more than 39% of your income. So, if you earn $6,000 per month, your mortgage payments should be less than $2,340 per month.
Put Up A Sizable Down Payment
The bigger your down payment, the less you’ll have to borrow from your lender to buy a home. And in turn, this will mean smaller mortgage payments. Saving up for a down payment takes time, so don’t rush into buying a home until you have a decent down payment. With that said, be careful as time goes by, house prices can also rise and outpace the rate you can save
Condo vs. House In Newfoundland And Labrador
There are so many decisions to be made when it comes to buying a home, including whether to buy a condo or a single-family house. Before you make that decision, make sure you weigh the pros and cons of each.
Reasons To Buy A Condo
- Condos are cheaper than houses. The lower price affiliated with condos makes them an attractive option for homebuyers on a budget, and a smaller price tag means lower monthly mortgage payments.
- No maintenance or repairs. Condo corporation will take care of maintaining the property on your behalf, which you pay for through your condo fees.
- Location. Condos are usually located in urban centres. As such, they’re closer to work, shopping, and entertainment.
- Building amenities. Condo buildings usually feature on-site amenities, such as fitness rooms, party rooms, swimming pools, tennis courts, and rooftop gardens.
Reasons To Buy A Home
- More space. There’s more square footage for living space with a single-family home, as well as more outdoor space to roam.
- Freedom and flexibility. You’re free to decorate as you please, have pets in the home, build a playhouse in the backyard, and paint your front door any colour. Houses can be customized to your liking, while condos can’t without permission from the condo board.
- No condo fees or condo board. Condo fees are an added monthly expense that many home buyers do not consider. You won’t need to worry about this expense when you own a house. Plus, there won’t be a condo board to deal with or condo board meetings to attend (if you’re a board member).
Final Thoughts On The Average House Price In Newfoundland
Buying a home in Canada, whether in the more affordable Newfoundland & Labrador or another province, is currently an unattainable goal for many Canadians. While the market outlook for 2024 is still up in the air, experts are suggesting that the market will balance out.
So how does the average price of a house in Newfoundland and Labrador affect you and your goal of becoming a homeowner? It’s simply one tool you can arm yourself with. You’ll know what you expect and can also compare different provinces and markets to help make an informed decision.
