Hamilton real estate prices have been on a steady incline in recent years, so it’s little surprise that the city’s housing market ranked #10 of 16 Canadian cities when it comes to housing affordability, according to the 2020 RE/MAX Housing Affordability Report. However, cost-conscious home hunters in search of a good deal can still find one in the communities of Crown Point, Homeside and Vincent, which have been named the most affordable neighbourhoods to buy a home in Hamilton.
Factors contributing to Hamilton real estate prices
Hamilton real estate prices have been on the rise, with Hamilton-Burlington experiencing a 4.3-per-cent increase from 2018 to 2019, and another 3.8-per-cent increase expected this year (source: 2020 Housing Market Outlook Report). This has contributed to the region’s ranking as one of Canada’s less-affordable housing markets, according to the new RE/MAX Housing Affordability Report.
In its inaugural Housing Affordability Report, RE/MAX examined 16 of Canada’s most-populous regions and ranked them on an affordability scale, with #1 being the most affordable and #16 being the least affordable. RE/MAX brokers were surveyed about average home sale prices and whether they believe real estate in their region is overvalued, undervalued, or right on the money. Hamilton real estate came in at #10 of 16 cities. Canada’s most affordable city to buy a home is Regina (#1) and the least affordable place to buy a home is Vancouver (#16).
RE/MAX’s affordability ranking was determined by assessing the percentage of a buyer’s monthly income needed to carry a mortgage, assuming a down payment of 25 per cent, and based on the forecasted 2020 average sale price per region and the forecasted 2019 average household income.
Hamilton real estate is currently considered to be undervalued, with a 2019 average sale price of $535,843. When compared to cities that are of a similar distance from Toronto, Hamilton homes are generally set at a lower price point, with more than 50 per cent of stock found below the $600,000 threshold.
First-time homebuyers are typically looking for single-detached homes and townhomes in the region, with a significant number of buyers relying on financial support from parents in order to be able to purchase. Common issues facing first-time home buyers in Hamilton include the mortgage stress test and shrinking inventory.
At the high end of the affordability spectrum, the region’s least affordable neighbourhoods include Meadowlands, Governor’s Road and Flamborough East.
Despite the commonly held notion that housing in Canada is unaffordable, the report finds that the vast majority of Canada’s largest urban centres (75 per cent) are currently undervalued, according to a survey of RE/MAX brokers in 16 of Canada’s most-populous cities.
In its report, RE/MAX explored the most popular property types sought by first-time homebuyers, the least and most affordable neighbourhoods in each of the 16 housing markets, factors preventing buyers from entering the market, and methods homebuyers are using to enhance the affordability of homes. Current and prospective Canadian homeowners were also surveyed about their sentiments around home ownership, barriers to owning a home, financial factors impacting home ownership, and what could potentially improve housing affordability.
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