.png)
Hamilton Real-Estate Market
It's not a surprise the Hamilton Real-Estate market has seen a significant correction over the last couple years. With slow economic growth, looming tariffs, economic uncertainty, higher interests rates and immigration grinding to a halt, creates a recipe for such a situation. We are teetering on the edge of a recession with some major institutions predicting a recession by end of 2025 or early 2026. So what to expect from here?
Roughly 60% of mortgage renewals come due fall of 2025. Keep in mind, most of these mortgages "locked-in" during Covid with a 1.5-2% interest rate on a 5-year traditional mortgage term. This may come as a shock for most home owners when they find out their interest rate renewal will soon double, increasing their monthly expenses. The banks fortunately had the stress-test implemented meaning even though they received such a low interest rate, they were approved based off a 5% interest rate as a safety net. This should aid in some mortgage renewals considering they were already approved to carry a mortgage based off a 5% interest rate.
One theory is, if we do not see an interest rate decrease on the September 17th rate announcement from the Bank of Canada, we could potentially see a surplus of homes flood the real-estate market come fall 2025. Thus, creating a massive amount of supply, with already limited demand, driving home prices down further.
Keep in mind, more people are also leaving Canada. with Q1 2025 being the second highest recorded quarter in history according to Statistics Canada, The current living conditions, growing unaffordability of the market conditions, and the current policies in place are making people really rethink their environment.
Lastly, new homes sales have grinding to a 50% decrease due to the cost to build. A study conducted for the advocacy group by Altus Group that if new home sales remain slow, we could see tens of thousands construction jobs go in the GTA with 40,000 direct home building jobs and 30,000 construction supply chain jobs on the line.
What To Expect?
A few key take-aways. We need to get our inflation under control in order to lower our Prime Interest Rate. Once the Government returns from summer break, depending on the policies they implement, it could stimulate the Canadian Economy in a healthy way. Bringing in investment and capital thus aiding in our GDP growth.
We also need consumer confidence to return to Canada. After April 2025, once tariffs were introduced the Canadian Economy froze leaving people frightened regarding President Trumps Tariffs.
So should I be buying or selling a home now?
If you are a buyer looking to purchase a home, it may be a great opportunity for you to enter the real-estate market. With more negotiating power on the price of the home, and leveraging conditions and warranties to protect yourself. We may never see such a great opportunity to purchase a home again for many years to come.
If you're thinking of selling, I advise to tread carefully. Unless you are thinking of buying and selling, then the market is relative if you're staying within the local market. You will sell low, but also buy very low, and vice versa...if you buy high, you will sell high. If you plan on just selling an investment property or a primary home for that matter, I'd recommend holding.
Need Help Navigating This Market?
Feel free to email us at [email protected] with any questions you may have. You could also call our office at 905-573-1188. We would be happy to guide you and inform you along the way in this challenging market.
William Marlow
Founder & Sales Representative
William Marlow Real Estate
RE/MAX Escarpment Realty Inc.
