November 2024 Real Estate Market Insights – Hamilton Focus

The Hamilton real estate market continues to navigate a period of significant economic and market shifts. Drawing on the latest data from the RE/MAX Appointment Centre and the Realtors Association of Hamilton-Burlington (RAHB), alongside broader economic indicators, here’s a detailed look at the November 2024 market trends and how they intersect with the changing economic landscape.

Three Fundamental Changes Impacting Real Estate in December

As of December 2024, several pivotal changes are shaping the real estate landscape in Canada:

Interest Rates: The Bank of Canada lowered rates by another 50 basis points, making borrowing costs more attractive for buyers and investors.
Mortgage Options: First-time buyers can now access a 30-year amortization option as of December 15th, easing monthly payment burdens and improving affordability.
Insured Mortgages: The limit on insured mortgages has been raised from $1 million to $1.5 million, expanding opportunities for buyers in higher price brackets to enter the market with lower down payments.

These changes are likely to influence buyer behavior in Hamilton, especially as affordability challenges remain top of mind for many.

Economic Context: A Canadian Economy on the Edge

To effectively analyze the real estate market, we must consider the broader economic climate. Unfortunately, the Canadian economy is under immense strain, with several worrying trends that could ripple through the housing sector:

Real GDP Per Capita: Currently at 2018 levels, representing six years of stagnation and no real growth.
Growing Unemployment: Job losses are mounting across key sectors.
Residential Construction Crash: Ontario and British Columbia, two of Canada’s largest housing markets, are facing sharp declines in new residential construction projects.
Challenges in 416 Condos: The Toronto condo market is grappling with oversupply and declining investor confidence.
Declining Manufacturing Sector: A long-standing pillar of the economy, manufacturing, is showing sustained weakness.
Rising Small Business Insolvencies: Small businesses are increasingly unable to withstand economic pressures, further dampening consumer spending and investment.

This backdrop highlights the fragile state of the economy. For progress in real estate, a broader economic recovery must first take shape.

Hamilton Real Estate Market: Key Trends

Despite economic headwinds, Hamilton’s real estate market showed notable activity in November. Seasonal slowdowns are evident, but year-over-year comparisons reveal growth in some areas:

Appointments and Sales: Hamilton saw strong buyer activity in November, with properties sold outpacing new listings by over 52%. However, the overall benchmark price dipped slightly from October to $763,400, though it remains nearly 2% higher year-over-year.
Price Segments: The $1M–$2M price range continues to dominate buyer interest, while the $950K–$1M range is gaining traction—an unusual trend for Hamilton, reflecting shifts in affordability and demand.
Property Types:
- Detached and Semi-Detached Homes: Both segments saw over 3% year-over-year price growth, reflecting their enduring popularity.
- Row Homes: Sales in this category have grown by 2% year-to-date, making it a standout performer.
- Condos: Facing the highest months of supply and a 5% year-over-year price drop, apartment condos are currently the most buyer-friendly option in Hamilton.

The Road Ahead: Variables That Must Shift

For real estate to see meaningful progress, several economic variables must change:

Job Creation: Employment opportunities are critical to restoring consumer confidence.
Economic Growth: Real GDP per capita must break out of stagnation to support sustainable demand in the housing market.
Construction Recovery: Addressing the decline in residential construction will be vital for balancing supply and demand.
Business Stability: Measures to reduce small business insolvencies will help bolster the economy and the housing sector.

Hamilton’s market, like much of Canada, is closely tied to these broader factors. While the recent changes in mortgage policy and interest rates are positive, the underlying economic challenges cannot be overlooked.

Conclusion

The Hamilton real estate market is navigating a delicate balance between buyer demand and the broader economic uncertainty facing Canada. While recent policy shifts may offer short-term relief, the path to sustained market growth requires significant improvements in economic fundamentals. At KV Real Estate International, we believe in providing you with a complete perspective on the market, helping you make informed decisions in these complex times. Contact us today to learn more about your options in this evolving market.