Average home price in Hamilton area dips below $1M as rising interest rates cool spring market

The average price of a home in the Hamilton-area housing market has dipped back down below the $1 million mark.

The Realtors Association of Hamilton-Burlington (RAHB) reported Friday that home prices fell just slightly in May to $995,408 - a first since they crossed the million milestone back in January.

The average price for a home in the area then hit a record high in February, apparently peaking - for now - at $1,134,153.

As increased inventory comes to the market, buyers have more selection, which may also lend to further negotiation power," said RAHB president Lou Piriano in a press release.

Compared to April, the average sale price for a detached home fell by more than two per cent to $1,110,298, while both townhouses and apartment-style properties dropped by more than 5 per cent to $817,253 and $669,477, respectively.

The marginal drop in price comes as sales activity in the region fell below typical levels" usually seen in May, according to Piriano, who pointed to looming interest rates forcing some buyers to sit on the sidelines.

Sales were down by more than 5 per cent from April, but took a more dramatic tumble of nearly 32 per cent when compared to last May.

Month over month, detached property sales fell by 3.8 per cent, while apartment-style properties tanked by 22.3 per cent. Only townhomes saw an increase in sales, with a slight jump of just three per cent from April.

However, last month did see a boost to the area's critically low inventory levels.

More than 2,630 homes hit the market in May, a month-over-month increase of 7.3 per cent and a 16 per cent jump compared to the same time last year. Piriano said detached homes saw the largest increase in listings with 1,811 new properties coming up for sale.

However, apartment-style properties still topped the ranks when it came to inventory availability for buyers, according to the association.

They also continue to have the most affordable price point" for buyers, with units typically falling between $500,000 and $700,000, said Piriano.

Fallon Hewitt is a reporter at The Spectator. fhewitt@thespec.com