Sudbury home prices rising, but city still one of the most affordable in Ontario: report
Greater Sudbury was the second-most affordable city in Ontario in 2020, according to a new report by Ontario Real Estate Association. (File)
SUDBURY -- Greater Sudbury was the second-most affordable city in Ontario in 2020, according to a new report by Ontario Real Estate Association.
The report listed Thunder Bay as the most affordable, where housing prices averaged $217,745, followed by Sudbury at $268,696 and Windsor at $303,183.
The report found the COVID-19 pandemic has spurred many people to move out of more expensive areas, a process accelerated by the surge in remote work brought on by the pandemic.
"Fifty-five per cent of employees who live in expensive markets surveyed by (a U.S. polling firm) indicated that they would move out of their current location if their office became remote permanently," the report said.
"Though less research has been done exclusively in Canada, an ADP Canada survey showed that 45 per cent of Canadians who are currently working remotely would like to continue that arrangement for at least three days a week after the pandemic ends. Essentially, the affordable nature of non-urban Ontario is extremely appealing."
Mining, forestry growing
Economies in rural and northern areas have also been less affected by COVID. The report found both forestry and mining saw employment growth in 2020, while sectors such as construction and real estate grew in more remote areas, while slowing in bigger cities.
"These sectors are proving their resiliency despite the pandemic and, luckily for the future of rural and northern Ontario, (mining and forestry) are almost exclusively located in rural and Northern Ontario," the report said. "Other sectors that have experienced growth, including the finance and public administration sectors, are also now able to operate in rural and northern Ontario due to the nature of remote work.
"Ultimately, the immediate impact of the pandemic on employment for those 15 to 54 years of age has been less severe for those living in rural and small towns than those living in urban centres. Though a temporary consequence of the pandemic, the less severe impact in these communities sets up rural and northern Ontario for an easier path to recovery."
And a December 2020 report from RE/MAX found the average sale price for a single-detached home in Sudbury increased to $335,247 in October 2020, and is expected to rise by another five per cent in 2021. Overall sale prices between January and October in Sudbury were $311,940.
"The Greater Sudbury housing market is in store for another seller’s market in 2021, thanks to continuing challenges in housing supply and rising prices," the report said.
"Low supply and rising prices are expected to be a continuing factor in 2021 market activity. Thus, the RE/MAX outlook for Greater Sudbury real estate is an increase of five per cent in average price to $327,537 across all property types, while sales expected to remain on par with 2020 levels."
Housing in short supply
Housing inventory in the city currently sits at one month, a shortage that resulted in seller’s market conditions in 2020 that is expected to persist in 2021, the report said, with no forecasted boost in housing supply coming on stream.
First-time home buyers were driving demand, with the hottest neighbourhoods for home sales in the South End, North End and Valley East.
"Demand from first-time homebuyers has increased in 2020 thanks to historically low interest rates and a healthy local economy," the report said.
"This buyer type – typically young couples in search of single-detached homes in the $200,000-$300,000 price range – is expected to be the primary driver of market activity in 2021."
Many current homeowners are buying up larger homes with more outdoor space in Greater Sudbury’s outlying areas, demand driven in part by people looking to leave larger urban areas.
"This has been a common trend across many Canadian housing markets as well as regions abroad, as homebuyers seek more square footage and green space outside of urban areas in the wake of COVID-19," the report said.
"Move-over buyers from southern Ontario are expected to continue migrating to the region in small but steady numbers. Young buyers who previously left the area are opting to move, thanks to their ability to work remotely, and Sudbury, among other northern Ontario markets, offering greater value for their dollar."
Read the full report here.