The Realtors® Association of Hamilton-Burlington (RAHB) reported 756 sales in October–which is below the 10-year average for this month. This is down about 40.8% over last year. However, there were 1,557 new listings this month, up 13% over last year.
The average home price in the region is also down year-over-year by about 6.8%, bringing the average price for a residential home in Hamilton-Burlington to $854,241. However, the prices are slightly up month-over-month.
These numbers show a more balanced market than we’ve seen previously, especially during the pandemic. RAHB president, Lou Piriano stated that there are certainly more opportunities in this type of market for first-time or move-up buyers, however, the danger becomes if buyers and sellers try to “time” the market. It is more important than ever for consumers to work with experienced local real estate agents.
While the market has certainly shifted in the past couple of months, we’ve made a few predictions about the Hamilton market over the next year. Read our blog right here.
Let’s take a closer look at what happened in the local real estate market last month:
Hamilton Market Activity
| Variable | 2022 | Difference |
|---|---|---|
| Sales Activity | 455 | -43.5% |
| New Listings | 956 | 9.6% |
| Active Listings | 1,391 | 191% |
| Months of Inventory | 3.1 | 414.9% |
| Average Price | $790,130 | -7.8% |
| Median Price | $715,000 | -7.7% |
| Average Days on Market | 29.1 | 145.3% |
Burlington Market Activity
| Variable | 2022 | Difference |
|---|---|---|
| Sales Activity | 168 | -33.3% |
| New Listings | 307 | 18.1% |
| Active Listings | 450 | 275% |
| Months of Inventory | 2.7 | 462.5% |
| Average Price | $1,098,493 | -5.2% |
| Median Price | $980,000 | -6.7% |
| Average Days on Market | 28.9 | 177.2% |
Sales Activity
There were 455 residential sales in Hamilton according to RAHB. This is down about 43.5% over last year. In Burlington, there were 168 sales, down 33.3% over last year. Reduced sales and increased new listings (more on that in a moment) suggest rising inventory levels from record lows, and a more balanced market compared to what we have seen for the past two years.
New Listings
While inventory still remains low historically, we are seeing more inventory in the area than recently. In Hamilton, there were 956 new listings this month, up 9.6% over last year. Burlington saw an increase of 18.1% over last year with 307 new listings.
Active Listings
Active listings in the region are also significantly higher than last year. Hamilton had 1,391 active listings, up 191% over October 2021. Burlington’s active listings were up this month by about 275% with 450 active listings. This will also impact the current months of inventory as well as the average days on market.
Months of Inventory
Months of inventory is often used as a measure to tell what type of market we are in, where anything over 3 months of inventory is considered a “buyer’s market.” This figure is calculated by estimating how long it would take to sell off the entire supply of houses if no new listings came on the market. In Hamilton, months of inventory is up 414.9% over last year, sitting at 3.1. Burlington’s months of inventory is up 462.5% at 2.7. As you can see, these numbers are just barely hitting the benchmark for a buyer’s market, but there are certainly more balanced than we saw last year.
Average Days on Market
In a market like this, homes are taking longer to sell, resulting in higher average days on market (ADOM). The ADOM for Hamilton in October was 29.1, which is about 145.3% up over last year. Burlington shares a similar ADOM with 28.9, up 177.2% over October 2021.
Average Prices
Home prices across the region are down year-over-year. The average home price in Hamilton was $790,130, which is 7.8% lower than in October 2021. The average price for a home in Burlington is still over the $1 million mark, at $1,098,493, which is down 5.2% year over year.
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In the News
October saw another interest rate increase from the Bank of Canada. While many traders predicted a 75-basis point increase after the latest inflation report results, the actual increase was 50-basis points. This brought the overall Policy Rate to 3.75%, a 14-year high. This lower-than-expected increase, while still significant, has some economists thinking that the Central Bank’s rate-increasing cycle is coming to an end sooner rather than later.
Doug Ford’s provincial government announced new legislation last month aimed at cutting fees for affordable housing and rental construction. The legislation will also help with “gentle density” as up to three units will now be allowed on any residential property province-wide. The government could not confirm how the new laws would help the province reach its goal of 1.5 million new homes over the next 10 years, however, the new package has set new targets for the 29 largest municipalities in Ontario.
The federal government recently announced plans to increase the quota for immigration. Immigration Minister Sean Fraser announced that the government would set a goal of bringing in 500,000 new residents each year by 2025, in order to address the critical labour shortage we are facing. The government says its focus will be on admitting more immigrants with relevant work skills and experience to address industries in particular need of labour.
A new survey by BNN Bloomberg found that 53% of mortgage holders surveyed were concerned about being able to afford payment when their mortgage renews. Most homeowners said they had a plan in place to address payment increases when the time comes. The majority of respondents said they plan to cut back on spending. A smaller portion of the respondents said they would dip into their savings or take on additional debt to deal with any increases. Only 2% of respondents said they would sell their homes if mortgage payments increased.
A Look at What’s to Come
As we approach the end of the year, many industry experts are predicting that the Bank of Canada’s tightening phase is coming to an end. They were aggressive with their increases towards the end of the year.
Although we are seeing a more balanced market compared to the busy pandemic days, there are still issues at hand. Rising interest rates and rising housing prices will continue to make affordability an issue for Canadians. And although we are reporting a year-over-year increase in new listings, this is only up from last year, when there were record lows. New listings are still nowhere near the “normal” levels we have seen historically.
For buyers and sellers in Hamilton-Burlington, the best course of action is to work with a local real estate agent and get into the market as soon as possible. Timing the market will not work in this instance, since it is next to impossible to predict where the bottom of the market is, until we’re on the way back up.
Are you thinking about making a real estate move in the near future? Call us at 1-844-484-SOLD or email us here for everything you need to know about buying and selling in this market.
