The United States housing market may be slumping, but the up-tick in mineral prices has the home selling and building sectors surging in many major Northern Ontario cities. 
The mining boom in Sudbury and Timmins and the emergence of a new knowledge economy in Thunder Bay has made for tight resale market and a burgeoning home construction sector in many areas.
Warren Philp, Northern Ontario Market Analyst for Canada Mortgage and Housing Corp. says across northeastern Ontario, other cities of Timmins and Sault Ste. Marie are all experiencing stronger housing starts to the end of September.
Philp attributes new home construction to the tight listings in housing markets in places like Sudbury and Thunder Bay.
The hotbed of activity continues to be Sudbury with so much being tied to the price of nickel.
In the third quarter, Sudbury recorded its highest level of single-detached housing starts since 1992. Starts totalled 183 units in the quarter, up 6.4 per cent from 2006. Overall starts for this year should reach the 500-unit plateau and easily surpass it next year.
Average prices on homes keep climbing with year-end forecasted prices at $179,769. Philp predicts that to increase to $197,746 for 2008.
Encouraging census data in Sudbury shows a net gain in intraprovincial in-migration. After losing hundreds of people annually between 1996 and 2001, Sudbury has shown positive growth, including 836 in 205-2006. But it still lags behind, considering the aging population and declining birth rate.
In Thunder Bay, Philp says he’s amazed at the “surprisingly strong” re-sale market activity in Thunder Bay this year considering the “marginal, at best” employment growth. Despite tough times many people are trying to maintain their roots in Thunder Bay.
Home listings are starting to dry up, particularly in the popular $120,000 to $220,000 price range, which is a trend across Northern Ontario major markets in the last five years.
In the first half of 2007 resales started strong, before cooling in the third quarter. Still, Thunder Bay was up five per cent.
At September’s end, CMHC recorded a 30 per cent decline in active listings with 659 compared to 946 last year.
“We’ve got reasonable demand, which is butting up against limited supply,” says Philp.
Like Sudbury, the mining camp in Timmins and through the Highway 11 communities are doing well.
Sales are up strongly seven per cent and prices up 11 per cent on average.
Home starts are the highest they’ve been in a number of years, says Philp, with starts up to this fall sitting at 52, poised at beat the 57 starts from 2006. “We’ve haven’t seen that high of single-detached starts since 1997.”
North Bay remains an active market with 78 single family homes under construction in the third quarter, the same number as last year. Home sales were on pace to break last year’s record of 1,446 sales. The average priced unit sold for $178,300, second highest only to Sudbury.
Sault Ste. Marie is brimming with confidence with new owners for Algoma Steel, and retail and institutional construction including the building of a new hospital in the city’s north end, where new subdivisions are going up.
Seventy-one homes were being built during the third quarter, up from 63 last year. Sales have risen for five consecutive year with average home prices sold for $108,000, up 8.2 per cent over last year.
For his 2008 forecast, Philp is pretty bullish about the North.
He says Thunder Bay needs better job growth numbers. The new knowledge economy gets the publicity, but there’s still more than 2000 lost forestry jobs to make up for.
In Sudbury, Philp doesn’t see an end to its growth, but he is calling for price moderation next year, predicting a 10 per cent increase, “which is probably the strongest I’ve ever made.”
He projects 480 new single home starts with 30 new multi-unit dwellings for the end of this year and 490 new starts for next year, including 120 new condos, apartments and semi-detached units.
