The Cornerstone Association of Realtors® reported 916 sales across the Hamilton-Burlington area last month. This is a great improvement both month-over-month and year-over-year. Many experts credit the climb in sales to the Bank of Canada’s recent interest rate cuts.
New listings in the region were slightly down about 0.2% with 1,938 new listings hitting the market. The average price in the area was up about 4.7% resting at $881,240.
Nicolas von Bredow, Cornerstone spokesperson for Hamilton-Burlington says home “purchases will become more attainable for hopeful buyers” as the Bank of Canada continues its rate-cutting cycle as anticipated.
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Let’s take a closer look at what happened in the local real estate market last month:
Hamilton Market Activity
| Variable | 2024 | Difference |
|---|---|---|
| Sales Activity | 536 | 27.6% |
| New Listings | 1,193 | -4.4% |
| Active Listings | 2,180 | 15.0% |
| Months of Inventory | 4.1 | -9.9% |
| Average Price | $821,512 | 5.3% |
| Median Price | $726,200 | 2.6% |
| Average Days on Market | 36.5 | 40.3% |
Burlington Market Activity
| Variable | 2024 | Difference |
|---|---|---|
| Sales Activity | 213 | 51.1% |
| New Listings | 434 | 8.8% |
| Active Listings | 638 | 18.6% |
| Months of Inventory | 3.0 | -21.5% |
| Average Price | $1,078,084 | -6.2% |
| Median Price | $975,000 | -6.3% |
| Average Days on Market | 28.6 | 18.3% |
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Sales Activity
Sales in Hamilton and Burlington were up significantly in October. There were 536 total sales in Hamilton, up 27.6% year-over-year. In Burlington, there were 213 sales, up 51.1% over October 2023.
New Listings
New listings slowed slightly month-over-month. On a year-over-year basis, new listings in Hamilton were down about 4.4% with about 1,193 new listings on the market. New listings in Burlington were up 8.8% over last year with 434 new listings.
Active Listings
Inventory, also known as active listings, was also down month-over-month but up over last year. In Hamilton, there were 2,180 active listings in October, up 15% over 2023. Burlington had 638 active listings, up 18.6% over last year.
Months of Inventory
Months of inventory, or supply, were down in both Hamilton and Burlington. There were 4.1 months of inventory in Hamilton, down 9.9%. Burlington had 3 months of inventory, which was down 21.5% over last year. This still represents a balanced/buyer’s market.
Average Days on Market
Both Hamilton and Burlington saw a steep year-over-year increase in the average days on market. The average DOM in Hamilton was 36.5, up 40% over October 2023. In Burlington, the average days on market were 28.6, up 18% over last year.
Average Prices
Residential average prices in Hamilton were up last month. The average price was $821,512, up 5.3%. The average price in Burlington was $1,078,084, down 6.2%
In the News
The Bank of Canada cut interest rates by 50 basis points at last month’s policy meeting. This marked the fourth consecutive cut. There is still one more policy meeting this year.
Conservative Party Leader, Pierre Poilievre says he will axe Canada’s 5% national sales tax on new construction homes under $1 million if he is elected. Poilievre says this decision would save Canadians about $40,000 on a $800,000 home. Poilievre also wrote a letter to provincial leaders urging them to eliminate the provincial sales tax on new homes under $1 million.
A new 2024 housing poll from Scotiabank reported fewer young Canadians owning homes today compared to three years ago. In 2021 47% of Canadians between 18-34 owned a home. This year, that number has dropped to 26%. About 29% of Millennial and Gen Z Canadians reported living with parents/family, which is up about 20% over 2021. However, the poll also found that 58% of Canadians aged 18-43 are “determined” to buy a home in the next 5 years.
Homeowners who regularly rent their property on Airbnb or similar sites will be subject to a 13% HST tax when they eventually sell the home according to a ruling by the Tax Court of Canada. The tax will apply to the total price paid for the property when sold, which could amount to a fee nearing tens of thousands or even hundreds of thousands of dollars. The ruling will have huge implications for property owners operating short-term rentals.
Bank of Canada officials warn that “playing with mortgage rules” to make housing more affordable could actually be detrimental to Canadians. The BOC says that focusing on “measures that reduce the short-term cost of (mortgage) financing, could have long-term impacts on the financial health of households.” According to the BOC, a 30-year mortgage will reduce monthly payments but could increase borrowers’ interest paid by $50,000 or more for the lifetime of the loan. Instead, the BOC says reaching a balance between supply and demand will be the best way to improve affordability.
A Look at What’s to Come
As expected, we saw another interest rate cut last month. It was the fourth consecutive cut, bringing the Policy Rate down a total of 125 basis points so far. There is still one more Bank of Canada policy meeting for 2024.
Most economists expected last month’s jumbo rate cut, which didn’t surprise me either. The BOC initially hiked rates faster than most people thought, and they will likely do the same on the way down. Markets are anticipating rate cuts through the end of 2024 all the way to summer 2025, finally coming to rest around the upper 2% range.
All of this will continue to fuel the housing market, encouraging sidelined buyers to act fast as rates go down. Changes to the mortgage rules and stress test also mean that uninsured buyers have more buying power, which will also ramp things up. Overall, this makes for a very interesting year ahead for the Canadian housing market.
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