Home sales los­ing fizz, but don’t panic, says an ex­pert

Those For Sale signs are stay­ing in the ground longer

The Hamilton Spectator - - FRONT PAGE - CARMELA FRAGOMENI

Hamil­ton’s hous­ing sales are los­ing steam after an over­heated mar­ket that saw su­per-fast sales and record prices.

Home sales fell 21 per cent last month com­pared to a year ago, ac­cel­er­at­ing the down­turn in May, when they dropped 3.5 per cent from a year ear­lier. There are also more houses on the mar­ket and they are tak­ing longer to sell.

“Show­ings are down. Mul­ti­ple of­fers are down, and more sale signs are up and stay­ing in the ground longer,” says Lou Piri­ano, pres­i­dent of the Real­tors As­so­ci­a­tion of Hamil­ton-Burling­ton (RA­HAB).

There were 2,756 new prop­erty listings last month, which is 23.8 per cent higher than the same month last year. In May, Hamil­ton had a record 3,208

new listings, which was 41 per cent higher than the same month last year.

The av­er­age num­ber of days on the mar­ket is up from a low of 14 days in April to 16 days in May and 18 in June.

Piri­ano says that’s still fast com­pared to the range in a nor­mal mar­ket, which is 35 to 40 days.

Paul Anglin, a Univer­sity of Guelph as­so­ciate busi­ness and eco­nom­ics pro­fes­sor who re­searches house sales, says: “It looks like the mar­ket is tak­ing a bit of a break, try­ing to process what’s come out of Queen’s Park two months ago with a list of 16 poli­cies to cool down the hous­ing mar­ket.”

On­tario govern­ment mea­sures taken to cool the mar­ket in­cluded a 15 per cent tax on for­eign buy­ers in the Golden Horse­shoe re­gion and leg­is­la­tion al­low­ing cities to tax va­cant homes.

Anglin says it’s too soon to de­ter­mine if the slow­down is a trend, “es­pe­cially on the pric­ing.”

The av­er­age house price in June in Hamil­ton was $537,367, which is up 8.6 per cent over a year ago, but down 11.2 per cent from a month ear­lier in May, when it was $604,848.

“The lower-priced prop­er­ties seem to be sell­ing more,” said Piri­ano. “That will bring the av­er­age price down.”

The fewer house sales, longer listings, and lower av­er­age price means fewer bid­ding wars and fewer sales that are thou­sands above the ask­ing price.

“In the past, I was not sur­prised to see a house sell­ing at $50,000 over ask­ing,” Piri­ano said, “but with more listings, there is less rea­son for buy­ers to get into bid­ding wars.”

Piri­ano said he sees pur­chasers now putting con­di­tions back into their of­fers, which he says is good news for in­ex­pe­ri­enced first-time home buy­ers.

In the GTA, home sales plunged 37.3 per cent last month com­pared to a year ago, the largest drop in eight years, the city’s real es­tate board said.

“There’s no doubt the mar­ket has changed,” said Christo­pher Alexan­der, re­gional di­rec­tor at Re/Max On­tario-At­lantic Canada.

RAHB’s CEO Ge­orge O’Neill in Hamil­ton agrees that “rel­a­tive to the last few months, yes, it has slowed down.” But he says sales are still up com­pared to the 10year av­er­age.

O’Neill, Piri­ano and Anglin all say the slow­down points to a more bal­anced hous­ing mar­ket. “People won’t be rushed so much,” Anglin said.

The three also don’t be­lieve

The lat­est Hamil­ton mar­ket num­bers in­di­cate a slight slow­down in sales.

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