Entry-level housing tight for first time buyers.

• Author: Stewart, Nick
• Position: SPECIAL REPORT: NORTH BAY

While the explosive growth of North Bay's housing scene is good news for some, deficiencies in the entry-level market are barring many would-be first-time homeowners from finding a place to call their own.

"The biggest problem we have right now is that we have a number of people on the entry-level housing scene that can't buy houses," Dave Wylie, president of the North Bay Real Estate Board, says.

"We haven't got anything for them right now. It's a big issue, and I don't know how we can address it just yet."

Homes in the $120,000 to $150,000 range are practically nowhere to be seen, and the ongoing boom of the local construction industry is contributing to the problem, Wylie says.

Labour and building costs have driven prices to hit nearly $200 per square foot. Combined with the rampant demand for higher-end homes and various municipal construction costs such as lot levies, developers have little incentive to cater to the lower end of the market.

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To help rectify the problem, the city recently tore down some CN Rail trestles in order to clean up and service an area specifically for the construction of up to 30 lots intended for starter homes. Proposals are still out for construction of the new homes, which will be built through the spring to be sold by the fall of 2008.

"We recognize the problem and feel that this is something we can do to help," Mayor Vic Fedeli says. "It's important to take these kinds of measures, because we fully agree with the North Bay Real Estate Board when they say it's a significant issue."

While this is a step in the right direction, Wylie says more comprehensive solutions will have to be developed in order to head off the issue.

As an example, he points to a Canadian Mortgage and Housing Corporation program which allows buyers of lower-end homes to install new doors, windows and roofing and apply it against the cost of their mortgage.

"While our city council has been involved, not many outside politicians have jumped on board, and I think it has to be a provincial issue. If ever they were short of houses in Toronto, my God, it'd be on the front page of the papers."

Until recently, some entry-level homes could be found by traveling to the outskirts of the city with a willingness and ability to engage in home repair. However, the overall tightness of the market has begun to drive up the costs of even these houses, further putting the squeeze on entry-level seekers.

This tightness, created by...