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A sellers market in Hamilton
The Realtors Association of Hamilton-Burlington held its annual news conference Wednesday and this year's president anticipates another solid year for the resale property market. In his inaugural speech, Mike Cusano said, "While most housing markets in Canada are headed towards more balanced market conditions, the Hamilton-Burlington market is poised to remain strongly in favour of sellers."
Noted fundamentals supporting this prediction include the sales to new listings ratio, which is expected to remain high at 67 per cent. This makes Hamilton-Burlington one of the tightest resale home markets in Ontario. For sellers, this may imply the return of bidding wars, unnatural price growth and shorter marketing periods. For buyers, it may imply a competitive market, especially for desirable properties. Following one of the most active Decembers in several years, Mr. Cusano reported the 2006 real estate market ended with over 13,640 Multiple Listing Service transactions, which is the third highest on record.
The total volume of real estate sales in the area surpassed $3.4 billion. This is the highest volume recorded in the association's history, which speaks to just how powerful the MLS marketing system is to the real estate industry.
In 2006, 75 per cent of properties listed were sold. The list to sales ratio is an excellent barometer to determine whether it is a buyers' or sellers' market. Clearly, the advantage was to the seller while mortgage rates favoured buyers.
The strong demand and the relatively lean inventory of homes available for sale combined to generate a total market activity average price increase of seven per cent to approximately $252,300 for the area. This marks the 12th straight year of growth in real estate values.
Even with the increases seen over the year, on balance, properties in the area continue to be affordable and buyers took advantage of the reasonable prices and low interest rates. A comparison among residential and condominium homes in the Hamilton-Burlington area averaged $248,800 while similar homes in the Greater Toronto Area averaged over $353,000.
Condominiums remain the most affordable housing option across all markets by far and accounted for close to one quarter of all resale activity. Condominium sales are thriving due to the busy lifestyles of commuters and empty-nesters who want to spend more time travelling and for those who would like to eliminate worrying about the exterior maintenance of a residential home.
"Looking at 2007, RAHB expects low mortgage rates and affordability," said Mr. Cusano. "Real estate is an interest rate sensitive sector and we believe any economic fluctuations in 2007 will result in market friendly conditions."
January 12, 2007 in Canadian Market Forecast | Permalink
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