Realtors expect Sudbury housing market to bounce back

Sudbury's 2015 housing market could see the one of the biggest years for growth in quite some time, says the president of the Sudbury Real Estate Board.

“I'm always excited. I think 2015 will hold a lot in store for us,” said David Kurt, who is also a sales representative with Coldwell Banker Charles Marsh Real Estate.

As of late November, 2014 proved to be a difficult year for Sudbury's real estate market overall, said Kurt.

Sales were down seven per cent, compared to the same time in the previous year, and the market was over-saturated, with a 10-per-cent increase in listings compared to 2013.

People typically like to list their homes in the spring and summer, Kurt said, but the long winter pushed a lot of sellers to wait for the summer before listing their homes.

That means there was more supply than demand in the summer months.

A lot of potential buyers, said Kurt, are also waiting to see how labour negotiations between Vale and United Steelworkers Local 6500 turn out before entering the housing market.

The current five-year collective bargaining agreement between the union and Vale will expire at midnight on May 31, 2015.

Kurt said a joint press conference between both parties Wednesday, Dec. 10, has hinted the outcome from negotiations could be more positive than in 2009, when the Steelworkers went on strike for a year.

“I think we'll see quite a big pickup in Sudbury in 2015 spurred by some positive labour negotiations,” he said.

Even though sales are down in 2014, compared to the previous year, house prices continued to rise in Sudbury.

According to RE/MAX, the average house price in Sudbury in 2013 was $250,518. The price increased by nearly two per cent in 2014 to $255,400, and is expected to increase 1.6 per cent in 2015, to $259,500.

But in a recent report, the Bank of Canada said home prices in Canada could be overvalued by as much as 30 per cent.

Even if the Bank of Canada's numbers are correct, Kurt said he does not expect a big impact on Sudbury's market.

“The average price point for a house in Ontario this year was around $455,000,” he said. “It's almost like we're having a half-price sale in Sudbury.”

Kurt said Sudbury's housing market has been more stable than Toronto's, where there have been more dramatic upwards swings in prices.

But even with a potential upswing in demand in the next year, housing starts have decreased.

By November 2014, there were 254 housing starts in Greater Sudbury, compared to 416 for the same period in 2013, according to the Canada Mortgage and Housing Corporation.

Kurt said increasing development charges have pushed developers to build more outside the city limits, and have also resulted in more semi-detached and condo buildings, where the charges are not as high.

Bruno Gobeil, the broker of record at Royal Lepage, said he agrees that 2015 should be a better year for the housing market than 2014.

“I think, in the spring, we should have a pretty steady market,” he said.

Gobeil said houses remain affordable in Sudbury, especially when compared to other markets in the province.

“Except for this year, I can say the activity in the market has been pretty steady,” he said.