In April, the real estate market started to show signs of a balanced market returning to the Hamilton-Burlington area. For example, the Realtors® Association of Hamilton-Burlington (RAHB) reported 1,298 sales of residential properties through the MLS® in April 2022. Although this is down 20.7% over March and down 31.3% compared to last April, there was an increase in the inventory of listings from 0.7 months in March to 1.2 months of inventory in April. A 'balanced' or 'buyers' market would typically require 3-4 months of inventory, so this is a step in the right direction for the Hamilton-Burlington area.
Furthermore, the RAHB reported 2,451 new listings in April, which was down 3.6% over March and 7% from April 2021. Although new listings are currently down year-over-year, the average sale price for residential properties in the Hamilton-Burlington area was $1,013,081, down 5.6% from March but up 18.2% compared to April 2021. This current moderation we're experiencing in the market is possibly due to the recent Bank of Canada interest rate increases enacted in mid-April.
RAHB President Lou Piriano commented, "With the exception of last year, new listings coming to market exceed that of every other April for the last ten years. With the increase in inventory, buyers are finally experiencing more choices in the market. While inventory is still below the norm, we finally see signs of a more balanced market as the number of active listings increases."
Let's break down what happened in the local real estate market last month versus last year:
In Hamilton, sales were down by 33.9% in April 2022 over the same time last year and saw only 783 sales compared to 1,185 the previous year. Similarly, Burlington saw a decrease in sales activity by 31.2%, and there were 276 sales compared to 401 in April 2021.
If you're looking for the latest homes in Hamilton or Burlington, be sure to check out our featured listings and learn more about the current local market.
New listings in Hamilton were also down by 14.1% over last year, with only 1,466 listings in April 2022 compared to 1,701 new listings in 2021. However, in Burlington, new listings were up 4.7%, from 494 in 2021 to 517 in 2022.
Hamilton's active listings increased from 883 in 2021 to 914 in 2022 - a 3.5% year-over-year increase. Similarly, in Burlington, active listing saw a significant increase of 31.2%, with only 250 in 2021 to 328 in 2022.
One of the fastest-growing neighbourhoods in Hamilton is Stoney Creek.
If you're interested in learning more about housing opportunities in Stoney Creek, click here.
Both Hamilton and Burlington experienced an increase in months of inventory over the same time last year. For example, Hamilton increased from 0.7 to 1.2 while Burlington rose from 0.6 to 1.2 months of inventory.
Even though month-over-month prices have slowed, the market is still seeing significant price increases year-over-year. In Hamilton, the average home price rose from $785,382 to $949,149, which is an increase of 20.9%. Meanwhile, Burlington home prices rose 15.7% from $1,061,995 in 2021 to $1,228,723 in 2022.
For Hamilton, the average days on the market have stayed relatively the same year-over-year, only rising 0.1 from 10.8 days in 2021 to 10.9 days in 2022. On the other hand, Burlington saw a decrease in average days on the market from 12.2 in 2021 to 9.6 in 2022 - a 2.6 day decrease.
The biggest news in real estate this month is the latest spike in interest rates by the Bank of Canada. On April 13, the Bank of Canada officially raised its policy rate to 1%, the most significant increase we've experienced in 22 years. Tiff Macklem, the Bank of Canada Governor, said that the increase was necessary to help quell inflation and that the economy can handle the increases as we continue to recover from the effects of the COVID-19 pandemic. However, he also went on to say that we should expect further increases as the Central Bank looks to reach its 'neutral' range of 2-3%.
Not long after the Bank of Canada enacted this policy rate increase, Canada's five big banks also opted to increase their prime lending rates. Now, RBC, TD, CIBC, BMO, and Scotiabank have all increased their prime rates to 3.2%. This impacts most people looking to apply for a mortgage and means that those looking to secure a pre-approval rate need to do so quickly.
Although sales are currently down in the Hamilton-Burlington area, it's important to remember that we are still in one of the busiest markets in recent decades. For example, a new market outlook report from the Canadian Mortgage and Housing Corporation (CMHC) estimates that Hamilton home prices will continue to increase over the next two years, possibly hitting an average price of $1.3 million by 2024. Therefore, buyers should take advantage of the current market rates and increased inventory levels before the market shifts again.
On the seller's side, the ideal time to sell would've been January or February, although right now is the next best time to sell. Rising interest rates often bring moderation to a market because buyers' budgets shrink and mortgage payments rise. So, that's why we recommend getting your home on the market sooner rather than later.
If you're interested in learning more about the Hamilton-Burlington market and what is currently available in your
desired area, be sure to check out my featured listings and do not hesitate to reach out to me directly!
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