‘A little daunting’: Pandemic pushes local real estate to lofty heights
People looking for more space are driving up prices on the limited supply of available homes
When Lori McConomy and Matt Lidstone bought 351 East 27th St. — a modest wartime house near Fennell and Upper Sherman avenues — they paid $430,000.
Seven months later, they sold it for almost double what they paid: $828,800.
“We didn’t even make it to offer day because people were sending us pre-emptive offers,” said McConomy, 41. “We didn’t expect it.”
The Waterdown couple bought the house as an investment and renovated it into a legal duplex, an in-demand type of property as it allows for both living space and income. Even though they had been through the buying process recently, they weren’t prepared for how aggressive the market had become when they were ready to sell in January. Over five days, 351 East 27th St. had 120 showings and sold for more than $225,000 over its asking price of $599,000.
The Hamilton-Burlington area was already on an upswing before COVID-19, but several pandemicrelated factors have turned a busy
market into a deluge, says Donna Bacher, president of the Realtors Association of Hamilton-Burlington. Many sellers, fearful of showings amid the pandemic, took their homes off the market and have been slow to return. Meanwhile, buyers buoyed by remote work arrangements are looking for roomier homes and more outdoor space. For those in downtown Toronto’s starter condos, that often leads to Hamilton or the surrounding area.
However, it’s not all Toronto people who are looking locally. “Anecdotally, it seems like the same mix as normal (some local buyers, some from Toronto and other municipalities), but higher numbers.” However, buyers from Toronto often come with deeper pockets and the expectation of higher prices, which can push sale prices out of range for some Hamilton buyers, according to several realtors who spoke with The Spectator.
McConomy and Lidstone’s interest in real estate investment was kicked into high gear when McConomy lost her job in insurance last year. Now she plans to flip houses full-time. The couple has already bought another house on the Mountain, for $650,000, with the intention of undertaking a similar renovation. Lidstone, 41, says the higher purchase price compared to their last flip is “a little daunting,” but they’re confident they will be able to flip it for a good price.
Their realtor, Bridgecan Realty’s Manny Haidary, thinks prices in the city are finally catching up to “where they should be” after being undervalued for a long time. “Hamilton has a lot to offer … Nobody really understands why we were so cheap for so many years, maybe because we had a bad rep because of the steel industry. People would drive by the bridge and see the steel companies, and think, ‘Oh my god, Hamilton.’”
In RAHB’s coverage area, the average residential home price was $787,840 in January, up a notable 27.6 per cent from January the previous year. Meanwhile, the number of available homes at the end of the month was 53.2 per cent lower than the same time a year earlier.
In a January report to her colleagues at Royal LePage Burloak’s Rocca Sisters Team, realtor Bonnie Glen points out that in greater Hamilton — including Glanbrook, Ancaster, Dundas, Stoney Creek and Flamborough — the average home sale price is 40.1 per cent higher than January 2020.
In old Hamilton, Glen says the vast majority of sales are occurring within a week of the listing date, compared to under 20 days in Burlington. Further, buyers are suddenly snapping up homes that have been on the market for weeks. “In January, we saw many (Hamilton) properties that had been listed for months sell for the asking price,” she adds. “We saw seven properties sell for more than 40 per cent over the asking price.” A similar phenomenon is happening in Burlington, where “properties that had been listed for the better part of last year re-listed and (sold) for considerably more than the original asking price.”
Many realtors are reporting an increase in condition-free offers and a vastly increased number of showings. However, RAHB president Bacher cautions those showing numbers could be inflated by the elimination of open houses due to COVID. “The people (who are curious but not serious buyers) are all coming through privately, where you might normally get 50, 60, or 100 people through an open house.”
Glen recently made the news with a home for sale in Kirkendall South that drew 102 interested parties for showings, despite being in such bad shape that it will have to be completely gutted. Photos of the long boarded-up home at 109 Kent St., near Aberdeen Avenue and Queen Street South, show a once-stately home with crumbling ceilings, unhinged cupboards and what appears to be black mould on the walls. The house was listed at $499,000 and got $615,000.
The home’s condition, which Glen described as like “a hoarder’s house on steroids,” was the result of an estate dispute that lasted two decades. “It will have to be taken back to the studs, but the location was the draw. It’s not every day this sort of opportunity presents itself. The fact that it had that third floor attic space, added probably 300 extra square feet. The potential for that house is pretty amazing. I think the buyer will have to spend $300,000 to get it where it needs to be.”
That buyer ended up being Elaine Warren, a Hamilton realtor herself. She is downsizing from a larger house nearby — a house she gutted and rebuilt, as she will with 109 Kent.
“After my contractor went through with me, he said, ‘This is in pretty good shape despite what’s obvious. It’s not a teardown.’ These are beautiful old homes. That’s what gives it that sense of uniqueness.”
Realtor Adam Cooke recently sold a two-storey house near Tim Hortons Field for $535,000 after asking $399,000. He said half of 44 Primrose Ave.’s 140 showings were Toronto agents, and a Toronto buyer will be the new owner. While that may be nice when you’re the selling agent, he notes the tables are turned when he’s representing local buyers.
“It’s frustrating because we get outbid all the time — $20-, $30- or $40,000 — by a Toronto person,” said Cooke, part of the McCarroll Team at Keller Williams Complete Realty. “As a buyer agent, it sucks. My customers are frustrated and I have to advise them to overpay … People are waiting (to buy) because they think they will be able to scoop all these bargain properties (after a crash). I don’t see the exodus out of Toronto slowing down.”