Despite pandemic, real estate prices soaring in much of northeastern Ontario

High demand and soaring prices are making it hard to buy a home during the pandemic Michelle and Cory Bourgeois say they’ve lost out on more than 20 offers in Hamilton, Ont., with a budget of $1 million.

Sudbury — Home prices are up – way up – in several areas of northeastern Ontario, according to the most recent statistics from the Canadian Real Estate Association (CREA).

The February figures show the average price for a home in Greater Sudbury rose from $278,541 in February 2020 to $372,641 a year later. That's an increase of 33.8 per cent.

Similarly in North Bay, prices rose from $213,400 to $284,700 during the same period, an increase of 33.4 per cent, the CREA said. Sault Ste. Marie also posted a strong yearly increase, with prices up 20.7 per cent, rising from $181,185 to $218,684.

The exception is Timmins, the only other northeastern Ontario community for which the CREA publishes statistics. Prices there dipped by 0.7 per cent, from $182,900 in February 2020 to $181,606 in February 2021.

The local statistics reflect national trends, said Costa Poulopoulos, chair of CREA.

“At this point, everyone knows how far the current monthly sales numbers are from historical norms, and that they have been setting record after record for eight months now, so this should not be a surprise like the weak numbers posted last spring were," Poulopoulos said in a news release.

"The two big challenges that continue facing Canadian housing markets are the same ones we've been facing for months – COVID-19 and a lack of supply. With luck, potential sellers will feel more comfortable listing their homes in the short-term."

The red-hot market is a reflection of a trend sparked by the pandemic in which more Canadians living in large cities are looking for more affordable housing as they increasingly work from home.

"These developments, from big-city households relocating to rural communities, to the digitization of the housing industry, have led to incredible growth in areas of the province and country that would normally not experience such a boom," real estate giant RE/MAX said in its housing outlook.

"The North Bay housing market is one of those rural municipalities in Ontario witnessing a once-in-a-generation surge. In the past, northern Ontario has faced challenges attracting young families looking to plant roots mainly because of the lack of development. As the saying goes, 'times they are a changing.'"

Remarkable growth

Sault Ste. Marie has also witnessed remarkable growth, attracting young families from the Greater Toronto Area.

"As more households search for a more living space at a lower cost, homebuyers look beyond the GTA and set their sights on small towns and rural communities," RE/MAX said.

The Sudbury Real Estate Board said residential sales surged at an annualized rate of 31.7 per cent in December 2020, topping 150 units.

"This is the first time in the municipality’s history that more than 150 transactions were executed in the month of December," RE/MAX said. "Home prices experienced double-digit growth in December and on an annual basis."

Supply shortages are also driving up prices in Sudbury. New residential listings edged up just 0.9 per cent in December from the same time in 2019. Meanwhile, active residential listings plummeted 59.6 per cent from the end of December of last year, coming in at 186. The real estate board said this the first time in more than 30 years that active listings have fallen below 200.

The CREA's national price map can be accessed here.