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Sault housing market continues hot streak in 2022

Average price of a home in Sault and area tops $337K last month

The average price of homes sold in Sault Ste. Marie and area so far this year has eclipsed the average price from the same three-month period last year by more than 35 per cent as demand for housing continues to ramp up. 

According to the latest housing market statistics from the Sault Ste. Marie Real Estate Board, the average price of the 418 homes sold between January and March of this year was $322,384, marking a 35.8 per cent increase over the same three-month period in 2021. 

Meanwhile, the average price of the 168 homes sold in the month of March was a record $337,097, representing a nearly 31 per cent increase from March 2021. 

“Demand is at its highest point ever right now, and that’s not only just those making moves, but there’s definitely some immigration to Sault Ste. Marie happening, and some investment happening right now as well,” said Sault Ste. Marie Real Estate Board President Jonathan Mogg, speaking with SooToday Monday. 

Mogg said that out-of-town investors are purchasing homes either to rent them out or resell them. He knows of one home recently put up for sale that was purchased by an out-of-town investor last year. 

“I wouldn’t say that’s super prevalent, but [I’ve] definitely seen that happening in this market,” Mogg said. 

Some houses are being purchased sight unseen and without conditions, said Mogg, which he attributed to a “fear of missing out.”

“The other part is that we’re undervalued with respect to the rest of the province, so if they’re looking for a cheap investment, there’s no better place than Sault Ste. Marie,” he said. 

There’s also more people entering the home buying phase of life, with people in their mid-20s and mid-30s wanting to buy homes, Mogg said, but there aren’t enough people moving out of the home market. 

“The boomers are staying in their house longer than ever, so that in itself has caused record supply issues - and with supply and demand being what it is, has caused prices to soar,” said Mogg. “Essentially there are more people entering the market than there are leaving the market.”

The 2022 federal budget is proposing $4 billion to launch a new housing accelerator fund for municipalities with a target to build 100,000 new homes in five years. Mogg said that he would like to see more mid-density housing, such as townhouses or condos, that will be affordable to first-time home buyers. 

“It’s cheaper to build them because you’re building row housing, so it saves on material costs and that kind of thing - and you can build a lot, and that’s what they do in southern Ontario, and that’s helped their issues, but again, it’s across the board in all of Canada that we’re having these record supply issues,” he said. 

While he likes the federal budget pitch for a tax free savings account that can be used toward a down payment on a home, Mogg said that he doesn’t see the two-year ban on foreign investors outlined in this year’s budget having any impact locally.

“It would have been nice had they either taxed or lowered the amount that numbered companies could purchase homes, and just kind of help tip the scale in terms of your average Canadian,” he said. 

In the meantime, Mogg, who is a broker at RE/MAX Sault Ste. Marie, says his office isn’t sure how long the increased housing market prices will last, resulting in a push to “get everything marketed sooner rather than later.” 

“But on the buyer’s side we’re frustrated because we’ve been working with some people for a long time - we have to ask them where their risk tolerance is,” said Mogg. “Luckily, I’ve been able to sneak in a couple home inspections this year, but it’s becoming more rare.”

“The biggest thing is from the buyer perspective, we would love to see stability.”

The Sault Ste. Marie Real Estate Board reported 117 active residential listings at the end of March, a nearly 31 per cent decline when compared to March 2021 and the lowest amount of active listings in the month of March in three decades.