Real Estate is a Hot Topic in Hamilton
- Derek Doyle
- 14 Mar 2016
Real Estate is a hot topic in Hamilton. We’re the hottest market in Canada, seeing a jump of 16.6 percent in housing prices over the last year.* But that isn’t the whole story. The market is hot now, but in order to see where we’re going, we need to look at where Hamilton has been. To do that, consider some of the changes we’ve seen since the year 1996. The past 20 years have seen incredible change for Hamilton. We’ve seen an amalgamation, infrastructure changes, and political unrest—and we’ve come out the other side with a stronger city. In the same way that these events have shaped our current market, what’s happening in our city now will lay the framework for how the real estate market continues to grow.
1996 was a good year. Mission: Impossible was released in theatres, the Spice Girls’ Wannabe became their first number one hit, and the Tiger Cats came in third in the CFL. The real estate market in Hamilton didn’t have as good a year: the total volume done that year was just over $1.5 Billion** for commercial and residential sales. In the late ’90s, Hamilton was still known as “Steel Town”—the steel capital of Canada. For some, this reputation acted as a roadblock for homebuyers.
On January 1, 2001, the new City of Hamilton was formed through the amalgamation of the former city and surrounding municipalities. This change, laid out by the City of Hamilton Act from 1999, expanded boundaries of the city. This change caused a centralization of municipal power, strengthening Hamilton by allowing for decisions to be made on a larger scale. In doing so, Hamilton’s real estate market grew to include these former municipalities. This helped spur residential sales, because moving to a larger municipality meant more services would be available to homebuyers. By 2002, a year after the amalga- mation, the dollar volume of sales increased to over $2.1 billion—nearing $2.2—a startling increase of over $600 million compared to 1996.
Hamilton Economic Development released their strategy for 2010-2015 with the following vision statement:
Make Hamilton the most innovative and entrepreneurial city in North America and develop the world-class infrastructure to support it.
This strategy included five major points that Hamilton was going to address: taxation, regulation, development incentives, physical infrastructure, and customer service. These areas of change provided incentives for businesses and homebuyers to move to Hamilton, and helped to change Hamilton’s reputation from Steel City back to the Ambitious City. By changing these policies and focusing on providing more “shovel-ready” employment land (through a variety of initiatives, including but not limited to airport growth, business parks, and a revitalization of the Bayfront) the city showed their commitment to economic development, and their commitment to businesses and citizens.
Economic Development’s strategy as a whole paid off in terms of the real estate market, and as of 2015 the annual dollar volume of residential and commercial sales was up to $7.3 Billion dollars, compared to $4.2 Billion in 2010. The average sale price has increased as well, from $337,225 to $447,003 over this five-year period.***
This growth has caught the attention of developers, big and small. Upcoming developments in Hamilton will provide opportunities for continued growth. Projects like the Royal Connaught by Spallacci Group, for example, are going to improve the Hamilton condo market by creating much-needed inventory. Resale from similar projects (such as the Witton Lofts by Core Urban Inc.) are seeing high demand, with some listings being sold within days of being put on the market. Adaptive reuse projects, like the two mentioned above, are what separate Hamilton from other cities on the rise. It’s projects like these that show how our growth and our history go hand-in-hand.
From these comparisons, you can see how hot the market is, and how much the city has grown. With so many new developments planned in the core and around the city, we can expect that this growth will only continue in the years to come.
*http://www.thespec.com/news-story/5843925-hamilton-housing-prices-see-biggest-jump-in-canada/
**RAHB History chart; information does not include private sales
*** RAHB History chart; information does not include private sales
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