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How’s The Market? Real Estate Outlook For 2023

By Stefan Walther | January 1, 2023

Thunder Bay Real Estate Outlook For 2023

“How’s the market?” It seems like such a loaded question, these days more than ever. And a question that no one really has the answer to anymore. We suppose you could comment on the current state of the market, or how crazy it has been the past couple of years — but what about the future? What about 2023?

Let us, the professionals at, help you break it down and make some sense. To do this, it is best to look at where we have just been, what is the trend, and then where we might be going.

The short answer: The Thunder Bay real estate market appears to be quite strong and robust going into 2023, especially for homes under $500,000. Sellers can still get lots of buyer interest and sell for excellent prices, as has been seen on in the last months of 2022.

The higher an asking price, however, the more difficult it becomes to attract more buyers and better prices. This has always been the case, but the market is far more sensitive now.

The little-bit-longer answer: Read on for some more insight. And, remember, we are always here to answer any questions or concerns you have. Call or text us anytime at 807-344-9393 or E-mail us at

With rising mortgage rates and other economic worries, it has never been more important to market a home in the best possible way and to the largest buyer audience, and this is precisely what does.

First off, it is important to understand that we are experiencing unprecedented times in the real estate market, primarily and heavily influenced by not only the challenges, but also the recovery, brought on by the COVID-19 situation. This is being called, after all, a once-in-a-lifetime worldwide pandemic and it is wildly affecting worldwide markets for not just homes, but all consumer products.

This significant world event has had, and continues to have, a profound effect on real estate markets nationally, internationally and, yes, even right here at home in Thunder Bay.

When COVID-19 hit in early 2020, interest rates were lowered to stimulate economic activity, to help people and businesses weather the storm, basically to increase everyone’s buying power.

But this newfound buying power had to be spent locally, at home, as international travel and vacations were hardly an option due to stringent restrictions that included border closures and vaccination mandates. This is why demand surged for home renovations, for home luxuries such as pools and hot tubs, for toys like boats and jet skis and snowmobiles, for new and pre-owned cars and trucks — and, of course, yes, for homes and recreation properties.

In real estate, demand surged far ahead of supply, pushing up house prices to levels never before seen. A typical three-bedroom bungalow in Thunder Bay that would previously sell for $290,000, now had an asking price of $399,000, was attracting multiple offers over asking, and was selling at close to $500,000, sometimes over. Half a million dollars. Truly incredible. And hard to believe that this was just eight months ago.

Thunder Bay Real Estate Outlook For 2023

At, we noticed supply of homes on the market actually come down, rather than stay the same or go up. Many potential sellers decided to stay out of the market due to concerns over the incredibly contagious COVID-19, in particular they didn’t want to open their homes to strangers (buyers) coming through, possibly spreading the illness. However, we also noticed many of these same sellers eventually did enter the market as the vaccine became available and recovery from the pandemic appeared closer, wanting to cash in on the high market.

For many of us, our home is our greatest investment, so we saw many decide to sell their home to essentially cash it in as their retirement income. Many made several hundreds of thousands of dollars over what they originally paid, and much more than what they could get just a couple of years ago.

Some home owners sold high, cashed in, and decided to rent until the market shifts and prices come down, which is happening to some degree now, to purchase their next home. Some of them are likely still renting but are looking at their next step, their next home, which is good news for other sellers who may list in 2023.

Many sellers simply stayed out of the market because they knew, if they sold high but immediately required another home to live in, then they would also have to buy high, negating much of any financial benefit.

Another trend we noticed during the pandemic was many landlords deciding to sell their rental properties, which is generally the idea behind these types of homes or apartments — buy low, make some good money renting for a number of years, then sell high. At some points during 2021 and 2022, half of’s listing were rental properties, not necessarily multi-unit homes and apartments but oftentimes just single-family rental homes so you may not have noticed that some of these listings were actually rentals. also listed a high proportion of estate sales, homes that needed to be sold because a family member, the homeowner, had passed away. No sense keeping an empty home and incurring extra costs like taxes and utilities.

Suffice it to say, during the pandemic years of 2020, 2021 and 2022, we were truly in the greatest seller’s market ever, now we are transitioning to what is very much a buyer’s market.

But if you are a potential seller, what does this mean for you? It is not as much doom and gloom as you may think.

Bad news first: It is important to note that the real estate market is now being affected by other negative variables, primarily inflation that has led to rising mortgage rates (and generally higher interest rates), which has led to decreased buying power and lower consumer confidence, which is causing many buyers to simply stay put. These issues have not only been brought about by situations around the COVID-19 pandemic, but also geopolitical tensions such as the Russia-Ukraine war.

But now the good news: There are still lots and lots of buyers in the market. Many buyers lost out on many homes during the frenzy of the past couple of years, and they are still looking for homes. keeps in regular touch with our sellers and, time and time again, they told us about all the incredible buyer interest they were receiving, sometimes 30-plus in-person viewings and multiple offers that were well over the asking price, often $50,000-plus over asking. We also talk to many buyers and we know they are still out there, still regularly checking our website and social media for hot new listings, the right home to purchase.

Currently, what we here at see with homes that we’ve listed in the last months of 2022, is that they are still selling at, or close to, their peak pandemic prices. The strategy, though, has changed somewhat, in that:

  • it is now more important to ask closer to what the home’s actual market value is
  • instead of 30-plus buyers interested, a seller may get 10 or so
  • instead of 10 offers over asking, a seller may get three offers that are close to asking
  • the home may not sell in two days anymore, it may take two or three weeks
  • and it is now far more important to use a tried and true service like, to market a home in the best possible way and to the largest buyer audience, in order to maximize the response and therefore maximize the selling price.

Want to chat about it? E-mail us, or call or text anytime 807-344-9393.

So that aforementioned typical three-bedroom bungalow? We’ve seen some newer ones in newer subdivisions (Parkdale, Tuscany Estates) still sell at or close to $500,000. In the older neighbourhoods (Northwood Park, Forest Park, Westfort) the selling prices are coming down more. But there is still good buyer interest and fairly strong demand.

Moreover, there is a simple fact in real estate and that is — people always move around.

People always buy and sell homes, for various life reasons. So there are always activity and movement in the market. An out-of-town professional may be looking for an executive home because they just received a lucrative new job offer in Thunder Bay. A home owner may now find their variable mortgage to be too expensive and it’s time to sell and downsize. Someone may want to move to a country property for more space and fewer neighbours. An elderly person may want to move back to the city to be closer to the hospital and doctor appointments. A son or daughter may want to move into a particular neighbourhood to be closer to their parents or other family. And the list goes on.

There are so many advantages to listing with, including the obvious which is showcasing a home in the best possible way and to the largest buyer audience, literally to over 20,000 people in the first 24 hours, to help get the best price and the top offer.

But another big plus is that, for only a small nominal listing fee,’s excellent service allows a home owner to “test” the market, to see if they can get some bites at a certain asking price.

Chances are good the home will sell quickly. But if not, no worries and no pressure, the listing can be removed and perhaps reposted at some other later date.

This is quite different from listing with a realtor, who will only get paid their hefty commission if the home sells, so there would be pressure and a binding contract, likely for at least three months. Not to mention the possible inconveniences and pressures of open houses and such.

Rising mortgage rates this past year have cooled off the market. There may be one or two more small increases in 2023 before stabilizing. They may even come down a bit. Time will tell.

They say it takes one to two years for even a small interest rate change to show its full effect on the economy. That the Bank Of Canada has been increasing the rate so frequently and so dramatically in 2022 shows how much it wants to curb soaring inflation, which we feel will come down to three or four percent in 2023, if not lower to its benchmark two percent, if not even lower.

We are sure that the BOC’s motivation was also to cool the overheated housing market, which it has also surely done, but more so in bigger, more active and complex markets like Toronto, Vancouver and Montreal. To a lesser extent in Thunder Bay, which has always been a bit of an isolated bubble, always a bit insulated from the big real estate waves. More like ripples or swells here in northwestern Ontario.

And then there is that dreaded R-word. Some economic indicators point to a recession happening in 2023, others do not. If it does occur, and like most everything else these days, a recession would likely not be so predictable and would not be similar to those of the past. Some elements of the economy could be down, others like the job market may stay strong. And Thunder Bay could once again be somewhat insulated and have a more muted downturn than the big urban centres.

Stay tuned to the Market Insider for further updates on the local real estate market — we will prepare additional periodic market updates, to continue to help enlighten and empower buyers and sellers, and help them achieve success should they find themselves in the market this year.

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Jessica Coley — RBC Mortgage Specialist

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