Seasonality appears to be returning to the real estate market in the Hamilton-Burlington area. The past two years of the pandemic were exceptional years that defied tradition, however, this year we are seeing a return to the typical cyclical nature of real estate.
The Realtors® Association of Hamilton-Burlington (RAHB) reported 811 residential sales throughout the market area through the MLS® in July 2022. This is down 18.5% over June 2022 and down 35.6% over July 2021. Months of inventory are also up, coming closer to a Balanced Market with 3.1 months of inventory compared to 2.9 in June.
Prices in the region are down month-over-month but continue to grow slightly year-over-year. The average home price in the RAHB area in July 2022 was $878,816–down 7.1% over June but up 3.9% over 2021.
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RAHB President Lou Piriano states that there are some anomalies in this month’s numbers, as the market is changing based on both seasonal factors as well as market factors including a significant interest rate increase earlier in the month.
He says that these numbers highlight the importance of working with an experienced Hamilton Realtor® who knows the intricacies of the local market.
Let’s take a closer look at some of the numbers for the month of July.
Hamilton Market Activity
| Variable | 2022 | 2021 | Difference |
|---|---|---|---|
| Sales Activity | 465 | 773 | -39.8% |
| Dollar Volume | $368,773,637 | $601,087,819 | -38.6% |
| New Listings | 1,032 | 918 | 12.4% |
| Active Listings | 1,464 | 674 | 117.2% |
| Months of Inventory | 3.1 | 0.9 | 2.3 |
| Average Price | $793,062 | $777,604 | 2.0% |
| Median Price | $732,500 | $715,000 | 2.4% |
| Median Days on Market | 18.0 | 9.0 | 9.0 |
| Average Days on Market | 22.8 | 17.0 | 5.8 |
Burlington Market Activity
| Variable | 2022 | 2021 | Difference |
|---|---|---|---|
| Sales Activity | 182 | 258 | -29.5% |
| Dollar Volume | $208,025,524 | $267,320,616 | -22.2% |
| New Listings | 364 | 303 | 20.1% |
| Active Listings | 445 | 183 | 143.2% |
| Months of Inventory | 2.4 | 0.7 | 1.7 |
| Average Price | $1,142,997 | $1,036,126 | 10.3% |
| Median Price | $1,020,000 | $972,500 | 4.9% |
| Median Days on Market | 19.0 | 8.0 | 11.0 |
| Average Days on Market | 26.1 | 13.7 | 12.4 |
Sales Activity
There were 465 home sales reported in Hamilton last month compared to 773 in 2021, representing a decline of 39.8%. In Burlington, sales were down 29.5% from 258 in 2021 to 182 in July 2022.
Want to learn more about the local Hamilton real estate market? Check out some of our other blogs to get started:
- Everything You Need to Know About the Closing Process in Ontario
- Mortgages 101: The Different Types of Mortgages in Canada
- Your Guide to Real Estate Laws in Ontario
New Listings
Inventory is still low in the region, however, new listings are up in both Hamilton and Burlington. In Hamilton, there were 1,032 new listings in July, up 12.4% over July 2021 when there were 918. New listings in Burlington were up by 20.1% in July 2022 from 303 to 364.
Active Listings
Active listings more than doubled in July 2022. In Hamilton, there were 1,464 active listings compared to 674 in July 2021. Active listings in Burlington increased even more (up by 143.2%) from 183 in July 2021 to 445 in July 2022.
Months of Inventory
Months of inventory are usually a good indicator of the pace of the market, and can give insights into what type of market we are in. Right now, we are seeing 3.1 months of inventory in Hamilton, up from 0.9 in 2021 and 2.4 months of inventory in Burlington, up from 0.7. This tells us that we are currently in a more “balanced” market than what we have seen in the past several years.
Average Days on Market
Avereage days on market are also up in Hamilton and Burlington. In Hamilton, the average days on market was 22.8 last month, compared to 17.0 days last year. Burlington saw an even bigger increase with 26.1 days on market in July 2022 compared to 13.7 days on market in 2021. This is welcome news for homebuyers who now have more time to consider their options before submitting offers on homes.
Average Prices
Although prices in Hamilton and Burlington are moderating month-over-month, they are still up over last year. The average price in Hamilton was up 2% over last year from $777,604 to $793,062 in July 2022. Burlington home prices were up 10.3% year-over-year from $1,036,126 last year to $1,142,997 in July 2022.
There have been a lot of changes in the Canadian real estate market over the last year. Read more about what you need to know here:
- What is the Homebuyer’s Bill of Rights?
- The 2022 Federal Budget and What it Means for New Homebuyers
- Ontario’s New Rules on Blind Bidding
In the News
Summer is usually associated with going on vacation, heading to the cottage, and putting all thoughts of real estate out of your head until the busy fall market returns. However, this year, the news cycle is moving so quickly that it’s difficult to find time to relax!
Statistics Canada is reporting the pace of inflation rose to 8.1% last month, putting even more pressure on the Bank of Canada to continue rising rates. The Central Bank, meanwhile, has just recently announced a 100-basis point increase earlier in the month, the highest increase we’ve seen since 1998.
Although these rate increases were expected, it is newsworthy to see the ramifications of the hike. Softening prices, a brief spike in inventory, and more active listings made for a much nicer market for buyers. However, many economists are predicting that this softening is only temporary and will revert back when the fall market hits.
As is usually expected when interest rates increase, the Toronto rental market saw a sharp increase with a rent increase of 20% over last year.
A Look at What’s to Come
The most recent 1% interest rate increase came as a slight surprise to those who were paying attention, however, the Bank of Canada has recently said that it is its goal to get rates up to 3-5% by the end of the year. We are currently sitting at 2.50% so it can be expected that more rate hikes are on the way after Labour Day.
As we adjust to the new normal, it would appear that sellers are beginning to become more realistic about pricing and selling expectations. Prices are lowering and inventory is increasing, this should keep going until at least the fall market. Sellers would be wise to list their home now while the inventory is still low and buyers still have more buying power before rates go up again.
For buyers, the situation remains a little dire. The initial shock of the interest rate increases has begun to wear off, however, with borrowing costs rising, and home prices not adjusting to the same level, it means that buyers can afford even fewer homes than they could at the peak of the market in February.
In uncertain times, working with an experienced and trusted local Hamilton real estate agent is the best course of action.
Do you have questions about the Hamilton real estate market? Michael St. Jean Realty is your trusted expert for all your buying and selling needs. Call us at 1-844-484-SOLD or email us here.
