House prices 'overvalued' in Canada, but not in Hamilton, CMHC says
Average Canadian home going for $433,649, Hamilton average in September was $380,000
This week, Canada's national housing agency released a gloomy forecast that deemed housing prices are "overvalued" in 11 of the nation's largest cities – but Hamilton isn't one of them.
In fact, Hamilton is one of only four of 15 major cities that isn't facing troubling signs of skyrocketing home sales that overstate the real worth of the area, the Canada Mortgage and Housing Corporation said in its latest Housing Market Assessment report.
"There remains weak evidence of problematic housing conditions in Hamilton," the report says. "Strengthening employment so far in 2015 continues to support homeownership demand in Hamilton."
- Up from last year, but Hamilton home prices 'actually quite stable'
- More attached housing to be built in Hamilton as prices rise: CMHC
The number of existing-home sales in Hamilton grew faster than the number of new listings in the second quarter, which pushed the CMHC sales-to-new-listings ratio up. That means there is little evidence of overbuilding, which is one of the markers of negativity the agency looked at.
In Hamilton, home prices and sales were up in September compared to the same month in 2014.
But don't think it's a runaway train, said the CEO of the Realtors Association of Hamilton-Burlington when those stats were released earlier this month.
"Everyone seems to think the prices just keep going up and up," said the RAHB head, George O'Neill. "That is true only in comparison to last year."
Average sales prices are "actually quite stable," he said, fluctuating so far this year within a range of about $15,000.
The median price for all homes sold in September was $380,000, up 8.6 per cent from the same month the year before. (The median price in August was $365,000.)
Earlier this month, the Canadian Real Estate Association reported that the average Canadian home sold in September went for $433,649, a figure that has risen by six per cent in the previous 12 months.
But the CMHC says many housing markets across Canada are showing troubling signs in four criteria:
- Overheated home sales.
- Too many homes being built.
- Prices increasing too quickly.
- High prices.
When all four factors are taken together, the agency singled out four cities for being particularly troubling: Saskatoon, Regina, Winnipeg and Toronto.
While those four cities gave the housing agency the most concern overall, overvaluation was called widespread.
It was cited as either a "moderate" or a "strong" problem in 11 of the 15 cities the CMHC includes in its assessment. That's up from the eight markets the federal agency deemed as being overvalued in its last quarterly report in August.