There's a phrase you hear an awful lot when the price of housing takes a dip: It's a buyer's market.
For real estate agents, that means a pretty serious shift of priorities — in marketing and and in client base. When the price of housing comes down, as it has in St. John's, a different type of person picks up the phone.
"It's catering to … the millennials that are out there between 20 and 40 years old," said Jim Burton, head of RE/MAX Infinity Realty, at the St. John's Board of Trade conference Thursday.
"They are looking at buying in the price range of $200,000 to $400,000."
The average resale price of a St. John's home has dropped, according to the Canada Mortgage and Housing Corporation. From an average high of $306,405 in 2014, the corporation projects prices could fall as low as $267,500 in 2018.
The dropping price of housing in St. John's is just one of the signs of a cooling-off in the provincial economy. Many businesses, not just real estate agents, are reacting to the shifts.
Times they are a-changing
Recreational spending, seen sometimes as non-essential, could be the first place consumers try to save a few dollars when times are tough. Businesses in that area are trying to sweeten their deals.
"We have a lot of discount pricing now," said Zac Dobbin, a business development specialist with MAX fitness clubs.
The company has also added a few drop-in programs, he says, to give people flexibility.
In the restaurant business, the downturn has been jaw-dropping. Andrea Maunder, the owner of restaurant Bacalao, says St. John's establishments are seeing their revenues drop by about 25 per cent.
She says the tough times may be partially responsible for a trend away from full, three-course meals into smaller, sharable plates — and that trend might be partially responsible for the restaurant business crunch.
Either way, she's reacting.
"We are moving toward a more shared-plate, bright-flavours, small-plate menu," Maunder told the St. John's Morning Show, adding the restaurant is going to try to fill a niche for Italian and Greek food.
"I think a big word for us in real estate right now is change," Burton adds. It's also patience — houses are on the market longer than they used to be.
Turning the corner?
But both Burton and Dobbin say business is getting better, not worse.
That's despite a dire presentation by Memorial University economist Wade Locke at the St. John's Board of Trade conference Thursday.
Thanks at @stjohnsbot for the opportunity to speak today with Wade Locke. Indeed some challenges out there but also opportunity.— @powerstim
He says the number of employed people in Newfoundland and Labrador is expected to drop by 35,000 by 2022. That's on top of current job losses since 2013.
"That's a big, big number. That makes the moratorium pale in comparison," he told delegates. "This is a diagram that should cause you a lot of concern."
Nonetheless, businesspeople are trying to hold onto an optimistic perspective.
Burton predicts an improvement in housing sale stats come springtime. Janine Browne, a sales director with Provincial Airlines, says there's opportunity in the north for her company.
Other businesses are more recession-proof, like financial consulting.
"We are in hard times. There's a lot of people, a lot of my clients aren't working right now," says Nicholas Williams, a consultant at Investors Group.
"But that's kind of where I can help them the most, is the fact that, you know, they need some advice right now."
An earlier version of this article misstated the expected drop in resale housing prices in St. John's. Prices are forecast to fall to a possible low of $267,500 in 2018 from an average of $306,405 in 2014.Feb 13, 2017 11:55 AM NT