A seller’s market

Housing starts in Thunder Bay are expected to rise 22 per cent this year despite a lower number of projected single-detached unit starts than 2010.

After 204 single-detached starts last year, this year the Canadian Mortgage and Housing Corporation is predicting 190 starts. However, a jump in multi-family units like semi-detached, rows and apartment housing is anticipated.

“Developers are picking up demand for additional condominium units; we are expecting a few projects to go ahead in 2011,” said Warren Philp, Northern Ontario market analyst. “The last couple of years have been quiet on that front.”

One reason for the increase in housing starts is the lack of listings for resale homes, Philp said.

“If people are looking around in the resale market and they can’t find a home because of the shortage, one way to overcome that is to build your own unit,” he said. “If you’re adding to the supply on your own, then you’re solving your own problem.”

Listing shortages are expected to continue this year with multi-listing home sales falling another five per cent and recovering modestly in 2012.

“Demand is outstripping supply right now causing prices to move up,” Philp said, noting Thunder Bay is currently a seller’s market with 40 per cent of sales from March and April of this year went at or above the asking price.

Philp credits the city’s aging population for the listings shortages. Throughout a person’s life they may have rented an apartment and bought up to three houses or built a house or two, he said, adding that later in life, people settle into a lifestyle and stay in their current home.

“They’re done with making major moves and if that in fact is the case…there would be fewer listings naturally coming onto the market,” Philp said. “People are staying put in a house they’re enjoying and plan on living in for a number of years now into retirement.”