Hamilton housing market sees slowest January since 2011

The Hamilton housing market saw its slowest start to the year in more than a decade in January, the Realtors Association of Hamilton-Burlington reported Thursday.

Just 349 residential properties were sold in the city last month, marking the lowest number of sales in the first month of the year since 2011, according to a press release. That number also represents a more than 21 per cent drop in home sales in Steeltown since last January.

But what held buyers back?

RAHB president Lou Piriano told The Spectator the fall in sales was understandable" given the impact of the Bank of Canada's key rate hikes from 0.25 per cent in March to 4.5 per cent on Jan. 25.

And it may take up to two years for the tide on interest rates to turn, noted Piriano.

When that does happen, Piriano said there could be a rush back to the market," a situation he predicts will also draw home prices - which have been dwindling for nearly 10 months - back up in the city.

In January, the average sale price for a house in Hamilton sank to $750,529, marking a 22.3 per cent tumble from the same time last year - and a more than $292,000 gap from last February, when prices skyrocketed to an all-time high.

However, Piriano said prices are still ahead" of those seen pre-pandemic and the rate at which they've dropped has slowed" in the city. The average sale price in Steeltown fell by just $72 between December and January.

Piriano said if more supply doesn't come to the market when rates are lowered, patterns of the pandemic-fuelled housing market will rear their ugly head once again.

Prices are going to come back up, I'm sure of it," he said. There is no point in history that they haven't."

For now, the city's housing market remains balanced, said Piriano.

There were 666 new listings in January, which is an increase of 23.3 per cent from the same time last year and a jump of more than 62 per cent from December.

The number of homes on the market climbed to 933 in January, which is a more than 280 per cent jump from the same time last year, but a slight reduction of 2.85 per cent from December.

A detached home in Hamilton stayed on the market for an average of 37 days - up from just two weeks last January.

This is a normal market," said Piriano, noting that inventory levels remain below those seen before the pandemic. It's not that give me all your money without seeing what you're buying' kind of market."

Year-over-year, detached properties in the city saw the largest sale price decrease, falling by 26 per cent to $809,019, while semi-detached homes saw their prices drop by close to 25 per cent to $683,400.

Home sales around the city slowed in most areas of Hamilton, with Flamborough seeing the largest decline, while Glanbrook saw the only jump in sales.

Nearly 100 homes were sold on the Hamilton Mountain, 53 were sold in Stoney Creek and 51 were sold in central Hamilton. Seven homes were sold in Flamborough, which was a drop of nearly 69 per cent from last January.

Year-over-year, detached property sales in the city fell by 17 per cent, semi-detached sales sank by more than 41 per cent, townhouses tumbled by around 13 per cent and apartment-style properties plunged by nearly 45 per cent.

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