Sudbury Insights

[Thomas Beyer]

We are contemplating buying a multi-family asset in Sudbury Ontario.

Is this a happenin` place ? Is the nickel mine productive and growing ? Is there anything of concern here ?

Any other comments .. pro`s .. con`s .. in-migration .. job growth .. vacancies ?

 

[Nir]

Hello Thomas,

Good question. I am interested to know too as someone recently recommended investing in Sudbury but did not provided/have any statistics. He is not an investor, just knows someone who invests there. I will try to reach him to get additional information, will let you know if I do..

I think there is a good/high rent to purchase price ratio - The distance from Toronto and any other major city might be the main reason (just my opinion). If you check the MLS you will find it is fairly easy to find properties meeting or exceeding the 10% annual rent to purchase price rule.

Cheers,
Neil

 

[kanabel]

QUOTE (thomasbeyer2000 @ Jan 21 2008, 06:17 PM) We are contemplating buying a multi-family asset in Sudbury Ontario.

Is this a happenin` place ? Is the nickel mine productive and growing ? Is there anything of concern here ?

Any other comments .. pro`s .. con`s .. in-migration .. job growth .. vacancies ?

Appreciaton last year was strong 20%, and there is little bit more of Sudbury in CHMC link: https://www03.cmhc-schl.gc.ca/b2c/b2c/init....ry=0/0000000079
Cheers
Dejan

 

[styxworld]

Hi,

there is an article in the Toronto Star about the sudbury mine, i think you will find it interesting

http://www.thestar.com/Business/article/296092

Good luck

 

[gregg]

Hi Thomas,

I am a new REIN member and live in Sudbury, Ontario. My wife and I have been investing in this (Sudbury) market since April 2007. Our experience has been very positive. Some investors locally think the market has peaked but I disagree. The market is dependent on the local mining industry however, Sudbury is the largest community in Northern Ontario (165,000 people) and there are many other economic fundamentals at play.

Unemployment is one of the lowest in the country and the vacancy rate is zero. People are crying for accommodation. I have owned a rental property (duplex) for over 20 years and haven`t seen the market this hot, ever. We have double our personal income since quitting our jobs to do what we are doing now.

As an example, our first purchase was a run down, beat-up fourplex which (I have a renovator at my disposal any time I need him) which we purchased for $84,000. (April 2007) and after three months of work it was appraised at $180,000. Very good return on investment. Another triplex we purchased for $107,000. and we put about $25,000. into was appraised last week for $195,000.

We currently have 21 units and our five year plan includes a minimum of 45 units to reach our goal. We are currently working with a JV partner (our second since we purchased a flipper for $54,000. and decided to include our renovator, as a bonus, to be our first JV partner. We are open to partner with others if you are interested. Please let me know and I can send you information on the market and our community.

Greg

 

[JCRE]

I grew up in Northern Ontario and my parent now live in Sudbury (since Feb 2006).Economy
I agree that Sudbury is a regional service centre as the largest city in Northern Ontario. It definitely has a more diversified economy with various government services, Laurentian University, Cambrian College and various other service business, but its still driven by resources.

Nickel mining is by far the biggest industry. The high demand for commodities has lead to higher Nickel prices and has helped the local economy boom over the last few years. Commodities are cyclical and if you review CMHC data you can see in the early 2000s things were much different. Higher unemployment, higher vacancy rates, etc.

Vale (formerly Inco) and Xstrata (formerly Falconbridge) are the major employers and I believe employ around between 5000-6000 people between them.

Real Estate Market
Obviously the local housing market is tied to nickel prices and this has contributed to the strong real estate market over the past few years. Average MLS sale price is up about 50% between 2001-2007.

I don`t have any direct investment experience in the market and I not saying don`t invest, but just be aware of the cyclical nature of the economy.

Hope that helps!

Joel

 

[mestonl]

Hi Greg



My name is Lynn and I currently own a number of properties in Sudbury, purchased in 2008 and 2009, all of which are doing quite nicely. I am presently considering two more properties, one four plex and one SFD in Azilda. What do you think the fundamentals are in the Sudbury are for the next 5 - 10 years? Feel free to contact me and we can share resources. [email protected]

 

[RedlineBrett]

Do you really want to own in a socialist have-not nanny state?



Once upon a time I was a mining engineer and still keep in touch with many friends that work in Sudbury. They're all doing well... But none of them rent!

 

[Thomas Beyer]

The asset we bought in 2008 did do OK for year 1 .. then year 2 and 3 not so great due to mining strike but still OK with manageable vacancies .. but ever since that is over (fall last year) it has been rather solid with increasing rents and low vacancies.. and asset value is up probably by about 20-25% in 3 years .. not a bad return with 20% down [plus some cash for improvements, of course] !

 

[RedlineBrett]

wow I didn't even realize that the OP was three years old. Oops!

 

[Thomas Beyer]

[quote user=RedlineBrett]three years old


.. indeed .. time flies .. but yes, Ontario is not the best place to invest given their rent control laws but you do get turnover like anywhere else (about 30%/year) so rents can then re reset to market .. and prices are lower .. still only high 40's to high 50's/door in Sudbury !!



Rents on turnover often go up 25-50%, from a rent controlled $500 for a 1BR, for example, to a market $750.

 

[laconicemi]

Hi Greg! Me and my sister are interested in purchasing an investment property in Sudbury. We are looking forward to connect with a REIN member like you who lives in the area. Are you still looking for partners?

 

[Tibo]

Hello I am a REIN MEMBER and live in Sudbury! I am looking for JV. You can email me at [email protected]

 

[Brandon Larose]

Anyone still active from this thread?

I am in Sudbury also, and looking to purchase my first rental property. Any info or resources would be great.
Currently looking looking at duplexes in the West End and South End areas of Sudbury.