P.E.I. home sales increase, contrasting national decline

Prince Edward Island (P.E.I.) saw an increase in home sales in February, diverging from a national decline in Canada. According to the Canadian Real Estate Association (CREA), home sales in P.E.I. rose by 10% from January. Economists suggest that smaller markets like P.E.I. can be more unstable, and factors like affordability are impacting sales positively. In February 2025, P.E.I. experienced a 7.7% increase in total home sales compared to the same month in 2024. However, Canada as a whole faced a 9.2% drop in home sales month-over-month, and a 9.7% decrease from February 2024. Experts point to uncertainty in the market stemming from political factors, such as potential U.S. tariffs on Canadian goods, which have made buyers hesitant. Economist Shaun Cathcart noted that while there is demand due to record population growth, the threat of a trade war is creating caution among buyers and sellers. He stated that low interest rates might encourage home buying in places like British Columbia and Ontario, alleviating some pressure on P.E.I.'s housing market. Interprovincial migration may also be influencing P.E.I.'s market. Homeowners from high-priced areas like Ontario and B.C. are looking to move to more affordable locations, which helps sales but can hurt young buyers who are now competing against those with higher purchasing power. Cathcart discussed the possibility of the Bank of Canada lowering interest rates to stimulate the economy. However, inflation concerns make this option complicated. A balance must be struck to support both homeowners and potential buyers in the current market.