Sudbury Real Estate Investing Success in 2023
Greater Sudbury – often referred to as simply Sudbury – is a city sitting on the apex of Lake Huron. There, this modest city is home to some of the most affordable, overlooked real estate in the province.
However, despite its humble population of approximately 166,000, it is still the largest city in Northern Ontario by population and the largest city in the province by land mass.
So, what investment potential lies in this small northern city? Let’s take a look and explore this under-appreciated market.
However, before we dive in, if you would like to learn more about how to finance your Greater Sudbury real estate investments, click the link below for a free strategy call with our team at LendCity today.
A Brief History of Sudbury Real Estate
Sudbury is known to many as the Nickel City, largely because of its rich history in the mining industry. In the 1880’s work on the Canadian Pacific Highway was passing through the region when the excavation process revealed high concentrations of nickel-copper ore in the ground on the edge of Sudbury basin. This led settlers to build colonies and mining camps in the area in order to harvest the precious resource while also building a service station for the rail workers. Then, by 1893, Sudbury was officially incorporated as a town.
This mining boom is what fueled the growth of Sudbury and its surrounding communities until eventually in 1973, these communities were reorganized into the Regional Municipality of Sudbury and then later merged into the city of Greater Sudbury in 2001.
Sudbury Real Estate Demographics
Greater Sudbury’s population was around 161,500 during the 2016 census. The average age is 41, and the average household income is about $72,000. The population is slowly growing—in fact, Invest Sudbury describes it as a “sustained period of population growth.” About 16 percent of the town’s residents speak French at home, which is no surprise thanks to its heavily French roots. Educationally speaking, 43 percent of its residents have completed college or trade school, and 19 percent have completed a bachelor’s degree or higher. However, 18 percent of the population has no certificate at all, including high school.
Sudbury’s average home prices were about $314,000 in November 2020, which is significantly lower than in major metropolitan areas like Toronto. The average rent is $1,275 for a one-bedroom apartment, and about 34 percent of Sudbury residents rent their homes.
When it comes to the economy, mining, government and education top of the most popular industries. However, there’s also a burgeoning film industry component, too—Sudbury has become a popular place to film and debut films in the last couple of decades.
Sudbury’s unemployment rate is recovering from the COVID-19 pandemic. As of September 2020, it hovered around 8.6 percent, which is lower than the 10.2 percent average for the entire country. The latest statistics showed that the Greater Sudbury district gained 1,200 jobs in August 2020, which is a promising sign of economic recovery.
Residential Investing in Sudbury Real Estate
Residential real estate is in high demand in Sudbury, making it a strong investment for investors who can get their hands on good properties. Fortunately, as long as you can identify a property you believe will make a good rental, the process is relatively easy from there.
Housing is quite affordable in Sudbury compared to other parts of the province, with the current average home being sold for approximately $402,000. This low cost is beneficial because market rent in the city is also on the lower side with an average two-bedroom apartment costing approximately $1495 per month on average.
However, the vacancy rate in Sudbury is quite low, so it may be possible to find a tenant willing to pay a higher price in order to secure a good rental unit. Currently, the vacancy rate in the city is estimated to be below 2 per cent. This makes it lower than the provincial and national average. Overall, this makes the rental market in Greater Sudbury more reliable for investors who want to avoid long turnover periods and droughts without offers on their listings.
The Mining Industry and Sudbury Real Estate
Sudbury would not exist as we know it today if not for the mining industry and the development of the Canadian Pacific Highway. In the 1880s space for the highway was being cleared in the region so that roads could be laid and constructed when something remarkable was found in the unearthed materials. The ground turned out to be filled with nickel-copper ore deposits all along the Sudbury basin. Naturally, this encouraged settlers and developers to colonize the region to begin mining and refining these resources so that they could use them for new technologies, machines and more.
Ever since then, mining has been one of the major industries that has employed the region’s residents and the businesses that comprised this field became major driving forces in the city’s economy. Even after the city reduced its focus on mining to reduce the damage to the local environment, the mining operations that persist in the region are some of the main drivers in the local economic environment.
According to a report from the Ontario Mining Association (OMA), Greater Sudbury is home to 27 per cent of the jobs in the Ontario mining industry with over $1.2 billion paid in wages back in 2019.
This means the investments and developments that work within or alongside the mining sector are going to have a stronger chance of succeeding in the region due to the strong focus on that sector in the region.
Tourism and Local Attractions
There are also plenty of major tourism draws in Greater Sudbury that can make it beneficial to invest in commercial properties such as hotels, restaurants, and other amenities that travellers may wish to access while visiting the city.
Most popularly, Sudbury is home to the largest interactive science museum in Northern Ontario in the form of Science North. This museum attracts approximately 288,000 visitors per year, with many of them being from visitors from outside of the city. The museum is comprised of two large snowflake-shaped buildings that are connected by an underground stone tunnel and an old hockey area which now serves as the facility’s main entrance and hosts an IMAX theatre.
As well the city is home to Dynamic Earth – an interactive science museum dedicated to archaeology, geology, and the history of the mining museum. Outside of this facility stand the Big Nickel – a nine-metre-tall replica of a 1951 Canadian nickel.
In regard to seasonal attractions, the city is also home to a variety of festivals and events that occur each year. This includes the Cinéfest Sudbury International Film Festival – an international film festival that shows over 135 films each year that highlight both English and French language films. This festival has been running since 1989 and hosts an average of 35,000 attendees each year.
Other festivals include the Up Here music festival which combines performance with the creation and installation of local art and murals and Japan Festival Sudbury – the largest Japanese cultural event in Northern Ontario.
Discover How To Buy Unlimited Rental Properties With This Step By Step Guide
Major Attractions in Sudbury Real Estate
Speaking of tourism in Greater Sudbury, there are a variety of tourist attractions that draw visitors into the city year-over-year that should be acknowledged.
Most notably, Science North – an interactive science museum – is the most popular tourist site in Northern Ontario with approximately 288,000 people visiting the centre each year according to an estimate from 2018. This beautiful facility is made up of two snowflake-shaped buildings and a former hocket arena that is home to an IMAX theatre.
For those looking to learn more about the region’s mining history, there is also Dynamic Earth, another interactive science museum dedicated to displaying the wonders of geology, archaeology, and the history of the mining industry.
Dynamic Earth is also home to the Big Nickel, a nine-metre-tall replica of a 1951 Canadian Nickel. This massive replica of a Canadian coin draws many tourists to come view it for the same reason that people travel to visit a giant rubber band ball or the world’s largest ball of twine – people enjoy standing next to large versions of small objects.
Communities of Sudbury
While the small towns and the city of Sudbury all combined into Greater Sudbury in 2001, the city’s communities largely maintained their own unique identities and are treated as separate by many of the city’s residents. These communities are Sudbury, Valley East, Rayside-Balfour, Nickel Centre, Walden, Onaping Falls, Capreol and the Wanup area.
The Demand for Large-Scale Residential Properties in the Sudbury Real Estate Market
Currently, the vacancy rate in Greater Sudbury is estimated to be less than two per cent. While this may bode well for the investors who already own rental properties or are capable of buying them, it does not leave a ton of room for the city to grow and for residents to move around. So, the city is in need of a long-term solution to introduce large quantities of new rental units all at once.
This is where Sudbury real estate developers and large multifamily properties come into play. Commercial residences such as apartment buildings, townhouses and condominiums add a large number of housing units to a location within a single property, thus making it easy to temporarily raise the vacancy rate and get more residents settled.
The Northern and Rural Immigration Pilot Creates Demand for Sudbury Real Estate
Part of the reason why Sudbury needs developers to come in and set up these properties is because the city is part of the Northern and Rural Immigration Pilot. This is a pilot program meant to incentivize new residents to move into northern and rural communities instead of larger urban centres such as Toronto in order to help make the country’s growth more manageable and sustainable.
Greater Sudbury Real Estate – The Nickel City
Real estate prices are steadily climbing for residential clients. In fact, November 2020 saw a 27.5 percent increase in home sales over November 2019—and that’s with the COVID-19 pandemic still raging. It’s actually the highest sale level in 15 years. In turn, prices rose, too, about 12 percent higher than last year at the same time. These statistics indicate that if you want to make a moderately-priced investment that should continue to gain in value, now is a good time to make your move. With the economy recovering and unemployment steadily lowering, the area may continue to grow in popularity.
Commercial real estate is harder to pinpoint. One of Sudbury’s biggest challenges is revitalizing the downtown core, particularly with retail and other attractions. So far, despite efforts like constructing the Place des Arts, most commercial real estate tends to be outside the downtown core. However, if you find a killer deal in the area, it may be prudent to jump on it—there’s every reason to believe that the area will continue to grow.
When you’re looking for a safe investment, Sudbury might be just the ticket.
So, if you are interested in diving into the incredible Sudbury real estate market in the new year, let’s get you started today. All you need to do is visit us at LendCity.ca or give us a call at 519-960-0370 and book a consultation today.
Sudbury Real Estate Professionals
We have searched high and low for real estate investing professionals in Sudbury. Below, you can find professionals we have researched and can confirm they specialize in working with Real Estate Investors.
To ensure the maximum success in real estate investing in Sudbury, or any city, you should always use professionals who understand and work with investors, your income depends on it.
This list may not fully list all the professionals in the area, but the ones we have personally investigated and that we would refer our clients to.
If you’re a real estate professional and would like us to consider adding you to the list, please contact us.
Mortgage Broker
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If you would like to learn more about how to finance your investments in Sudbury real estate, click the link below to book a free strategy call with our team at LendCity.