Between 2019 and 2022, the average house price in Greater Sudbury nearly doubled.
In several northeastern Ontario cities, housing demand remains high while supply is limited. However, real estate agents in the region predict that 2023 will be a better year for buyers.
While housing demand is down from peak levels in 2022 due to rising interest rates, Sudbury Real Estate Board chair Adam Haight believes it will not return to pre-pandemic levels.
“I honestly believe that going forward in 2023, we’re still looking at a sellers’ market, probably for the entire year,” Haight said.
“And you know, depending on what happens with interest rates, if they continue to rise, there’s a chance we’ll start to see a little bit of a decline.”
Improvements in the Housing Market in Sudbury and Sault Ste. Marie
According to Haight, the average price for a home in Sudbury in 2019 was around $265,000, but it has now risen to more than $450,000.
However, he added that current prices are lower than summer 2022 highs. The Bank of Canada raised interest rates several times during the year, which cooled the market.
Despite the city’s limited housing stock, Haight believes buyers are better off today than they were last year, when more than ten people could have competed for the same home with all conditions waived.
According to Jonathan Mogg, president of the Sault Ste. Marie Real Estate Board, the housing market in his city is showing signs of improvement.
“I truly believe that now is a good time for buyers who have become disillusioned with the buying process,” he said.
“Now may be the time to reconsider going for it and trying again because I am noticing market stability and it is a good time for buyers to really start, you know, trying to get out of that rental situation and have that chance to buy their first home.”
Mogg recently assisted some clients who had been in the market for a while in purchasing their homes because they were able to be more cautious and have the homes inspected before purchasing.
Impact of Higher Interest Rates on Housing Market in Northern Ontario
Higher interest rates, he claims, have also reduced demand from investors from other parts of Canada, implying that locals will face less competition for homes.
However, as in Sudbury, Mogg believes that prices in Sault Ste. Marie will not fall below pre-pandemic levels, even if interest rates continue to rise.
“You know, $250,000 used to get you a three-bedroom bungalow in a nice neighborhood,” he said.
“Now you’ll either be staying in a less desirable location, or you won’t get quite the same size of house.”
Ryan Humble, past president of the North Bay Real Estate Board, expressed gratitude to the Bank of Canada for raising interest rates to help correct the housing market and combat inflation.
“The market couldn’t keep going the way it was,” Humble said.
“Prices were rising quickly and dramatically. It was difficult to keep up with, and many of these first-time buyers were quickly… falling out of reach. That is something we haven’t seen much of in the north in recent years.”
According to Humble, the average sale price in North Bay peaked around $565,000 last May.
Buyers in North Bay now have the “luxury” of doing their research and due diligence before purchasing a home, according to Humble, because demand is not as high as it was last year.
