Ontario’s Greater Golden Horseshoe doesn’t just sound like the land of real estate opportunity – its markets have been popular home buying destinations in recent years, particularly Hamilton real estate.
Homes for sale in Hamilton remain a high point of interest due to their comparative affordability – the average home price in the city was $543,210 in December, according to the REALTORS Association of Hamilton-Burlington (RAHB), considerably lower than the average of $750,000 it takes to purchase a home within the neighbouring GTA. Hamilton condos have also seen impressive growth as an affordable entry point.
“The ongoing revitalization of the downtown core is quickly cementing Hamilton’s status as a regional destination for food, culture and the arts,” says Lori Mancini, a Zoocasa real estate agent in the Hamilton-Burlington area. “’Beautiful renovated homes, condos, and future pier development plus a growing number of trendy restaurants, galleries and shops along James Street and Locke Street make the area appealing to buyers from Toronto looking for a similar lifestyle at a better price point.”
The Hammer has also provided great return on investment in recent years for existing homeowners; despite experiencing a slight 1.4% drop in prices in 2018, values have grown 90% since 2008 in the Hamilton market, says RAHB. For example, Lori notes that the Ainslie Wood and Westdale neighbourhoods are popular with students attending nearby McMaster University and present an attractive opportunity for real estate investors.
However, whether or not a housing market can be considered truly affordable comes to down to whether local incomes remain aligned with housing prices; city residents must be able to qualify for, and financially carry, a mortgage for the average priced home in order for that to be the case.
To see whether this applies throughout the Hamilton market, Zoocasa.com crunched the numbers, calculating the minimum income required to afford the average-priced home in each neighbourhood, as reported by RAHB. That amount was then compared to the actual median income earned in each, according to Statistics Canada. For the calculation, it was assumed the buyer qualified for a 30-year mortgage at 3.35%, and made a 20% down payment.
15 Hamilton Markets Considered Affordable
The findings reveal that out of the 25 markets assessed, a total of 10 cannot be considered affordable for a household earning the median income, while 15 remain within the realm of affordability.
The neighbourhoods of Binbrook and Mount Hope topped the list of neighbourhoods that were friendliest on the finances – in this former-agricultural area-now-development hotspot, a buyer earning the median income of $67,846 could qualify for a home priced at $493,825, and still have an income surplus leftover of $31,512.
The Homeside / McQuesten neighbourhoods located in Hamilton East ranked second, requiring an income of $44,981 to purchase a home priced at $329,385, as well as the Kirkendall and Durand neighbourhoods in investor-friendly Hamilton West, where an income of $69,385 could qualify for a home priced at $508,100.
On the least affordable end of the scale is Ancaster which, while family oriented, remains pricey with little turnover. There, a buyer earning the median income of $86,148 would fall $18,823 short of qualifying for a mortgage for the average home price at $768,692.
Check out the most (and least) affordable Hamilton neighbourhoods in the infographic below:
Top 5 Most Affordable Hamilton Neighbourhoods
1 – Glanbrook: Binbrook, Mount Hope
Average Home Price: $493,825
Income Required: $67,846
Actual Median Household Income: $99,358
Income Surplus: $31,512
2 – Hamilton East: Homeside, Normanhurst, McQuesten, Parkview
Average Home Price: $329,385
Income Required: $44,981
Actual Median Household Income: $63,631
Income Surplus: $18,650
3 – Hamilton West: Kirkendall, Durand
Average Home Price: $508,100
Income Required: $69,385
Actual Median Household Income: $86,148
Income Surplus: $16,763
4 – Hamilton West: North End West, Central Hamilton, Strathcona
Average Home Price: $524,444
Income Required: $71,617
Actual Median Household Income: $86,148
Income Surplus: $14,531
5 – Dundas
Average Home Price: $525,272
Income Required: $71,730
Actual Median Household Income: $86,148
Income Surplus: $14,418
Top 5 Least Affordable Hamilton Neighbourhoods
1 – Ancaster
Average Home Price: $768,692
Income Required: $104,971
Actual Median Household Income: $86,148
Income Gap: $18,823
2 – Waterdown
Average Home Price: $629,688
Income Required: $85,989
Actual Median Household Income: $69,024
Income Gap: $16,965
3 – Hamilton Centre: Delta, Gage Park, St. Clair
Average Home Price: $433,467
Income Required: $59,194
Actual Median Household Income: $43,717
Income Gap: $15,477
4 – Stoney Creek: Heritage Green, Leckie Park, Trinity, Valley Park
Average Home Price: $560,180
Income Required: $76,497
Actual Median Household Income: $63,631
Income Gap: $12,866
5 – Flamborough
Average Home Price: $814,650
Income Required: $111,247
Actual Median Household Income: $99,358
Income Gap: $11,889
Methodology
Average home prices were sourced from the Realtors Association of Hamilton-Burlington.
The income required to afford the average home price was calculated using the Ratehub mortgage calculator (www.ratehub.ca/mortgage-affordability-calculator), assuming a 20% down payment, a mortgage rate of 3.35% and a 30-year amortization. The calculation does not factor in carrying costs such as property taxes and heating.
Median household incomes are sourced from Statistics Canada.
