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Thunder Bay house prices shoot up in a seller's market (2 Photos)

Demand, and a lack of inventory, have created a hot housing market

THUNDER BAY — In her 16 years as a real estate agent, Karen Hill has never seen anything like this.

Just as in much of Canada, the housing market in Thunder Bay has heated up substantially in recent months.

It's a seller's market in the city, with demand severely outpacing listings.

Hill is the vice-president of the Thunder Bay Real Estate Board.

She said that in a normal year there should be 700 residential properties available at this time, but as of Tuesday there were only about 125.

According to Hill, the median selling price for a single-detached home climbed to $291,200 in March, an increase of 26 per cent from the median price in March 2020, which was about $230,000.

She said it's become increasingly common to see multiple offers on houses within what she described as the affordable price range.

"It's usually anywhere from $150,000 anywhere up to $400,000. But this year has been unique because we've actually seen multiple offers over the $500,000 range too," Hill said.

She's aware of one instance where there were twelve offers, but said it normally ranges from four to eight.

"We've had that a little bit in years past, but this last three months has been very unique for sure."

Houses are selling much more quickly than last year, and often for well over the asking price.

All price ranges are affected.

Hill said one property listed for around $700,000 sold last week for about $200,000 more.

She said buyers and their agents are being as creative as possible to find an advantage in the midst of the increasing competition.

One client arranged to have a home inspection done in advance of the showing, so was able to successfully submit a bid with the results of the inspection already in hand.

Hill said other buyers are resorting to writing "love letters" to the seller in the hope that sharing their personal story will give them the edge.

"If you're in a multiple-offer situation, with sometimes eight people looking for the same house, sometimes young homebuyers have written a letter to introduce themselves and compliment the seller and why they've fallen in love with their particular house."

It seems that can be an effective tactic, as Hill cited a case in which a homeowner who was moved by a letter accepted an offer that was $7,000 less than another one.

Low mortgage rates and "the COVID factor" are two contributors to Thunder Bay's tight housing market.

"Post-COVID, when the interest rates went as low as 1.79 per cent, it has created a lot more buyers. They're moving from apartments, or even with workspaces at home. They need a bigger house, where they can work from home," Hill said.

She expects the market will remain extremely competitive through the spring and summer, even as listings increase with the arrival of warm weather.

But people looking to buy lakefront properties may find it even more frustrating.

Hill said there are currently virtually none available in the Thunder Bay area.

 

 

 

 



Gary Rinne

About the Author: Gary Rinne

Born and raised in Thunder Bay, Gary started part-time at Tbnewswatch in 2016 after retiring from the CBC
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