Fri. Sep 22nd, 2023
    Thunder Bay House Prices Expected to Remain Stable Despite Higher Interest Rates

    Despite higher interest rates for borrowers, house prices in Thunder Bay are expected to remain stable and comparable to last year. According to data from the Thunder Bay Real Estate Board, the median price for residential detached homes sold between January 1 and August 31, 2023, was $332,000. This is slightly higher than the median price of $330,000 during the same period last year.

    The increase in mortgage rates would typically lead to a decrease in demand and prices. However, board president Wes Case explained that the housing shortage is still a major factor, resulting in prices remaining stable. Thunder Bay, like many other cities in Canada, is experiencing a national housing shortage, leading to a seller’s market where there are more potential buyers than available houses for sale.

    Case does not anticipate significant changes in house prices heading into the winter. However, he highlighted the difficulty in predicting the future market, particularly with regards to interest rates, inflation, and the development of new housing units. Currently, Thunder Bay is estimated to have a shortfall of 900 housing units.

    The recent announcement of a provincial government target of 2,200 new housing starts in Thunder Bay by 2031 is expected to help address housing accessibility challenges. Although achieving this target may be ambitious, meeting at least 80% of it would make significant progress in providing affordable housing.

    A report from RE/MAX Canada supports Case’s expectation of stable pricing in Thunder Bay this autumn. It also forecasts minimal changes in house prices in the Peel region, downward trends in prices in several markets, and increased prices in the Greater Toronto Area, surrounding communities, and Sudbury.

    Overall, despite higher interest rates, Thunder Bay’s housing market is expected to remain stable, primarily due to the ongoing housing shortage and limited supply.