THUNDER BAY — Despite higher interest rates for borrowers, house prices in the city remain comparable to last year, and are expected to change little in the coming months.
According to data provided to TBnewswatch by the Thunder Bay Real Estate Board, the median price for the 590 residential detached homes sold between Jan. 1 and Aug. 31, 2023 was $332,000.
That's slightly higher than the median price of $330,000 during the equivalent period last year, when 708 houses were sold.
The significant increase in mortgage rates might be expected to reduce demand and prices, but board president Wes Case said it's still a seller's market because of low supply.
"As much as interest rates have increased over the past year, the housing shortage right now, which is a national problem, has really led to the prices remaining about the same even with the interest rates."
"A seller's market just means there are more potential buyers than there are houses for sale. And much like the position we were in the last couple of years, it's still a seller's market."
He doesn't expect prices to change much either way heading into the winter, but said it's harder to predict what the market will look like next year.
"We did just go another rate announcement today from the Bank of Canada, which has held its rate at five per cent. This is the first time in months that it has not increased... It boils down to will interest rates remain, what will happen with the inflation rate, will new developments and housing starts create more housing for people?"
It's estimated that Thunder Bay currently has a shortfall of 900 housing units.
Case feels the recent announcement of a provincial government target of 2,200 new starts in the city by 2031 will ultimately help make housing more accessible for those who face challenges getting into the market.
"It's a lofty target because the housing starts would have to be up significantly from what's occurred here in past years, but I think if we are able to meet at least 80 per cent of that target the amount of housing it'll provide will help achieve affordable housing."
This week, a report from RE/MAX Canada supported Case's expectation of stable pricing in Thunder Bay this autumn.
In Ontario, it forecasts little change in Thunder Bay and the Peel region, a downward trend in prices in numerous markets including Ottawa, Hamilton, Windsor, Durham region and Kitchener-Waterloo, and increased prices only in the Greater Toronto Area, some surrounding communities, and Sudbury.
