Many Hamiltonians have been completely iced out of the housing market over the last few years and it’s only gotten icier since the pandemic.
It’s not uncommon to hear stories about a $600,000 home in Hamilton receiving 12 bids in the first 12 hours and selling for $200,000 over asking.
Many from the Toronto-area are seeing their new job flexibility that includes working some or all of their days from home as an opportunity to relocate to a comparatively cheaper market. There have also reportedly been an influx of investment groups buying up property at way-above market value, further driving prices to exorbitant levels.
So with that, let’s take a journey to the year 1947.
The 19th Academy Awards were hosted by Jack Benny; the Toronto Maple Leafs won the Stanley Cup (LOL) by defeating the defending champion, Montreal Canadiens 4-games-to-2; and Canada repealed a law that made it so a woman would automatically lose her citizenship if she married a non-Canadian.
Also, you could buy a nine-room home in Hamilton for $7,200.
A Reddit user by the name of “AssEatinSeazn” (LOL, again) posted a photo from what they say is a newspaper from 1947, featuring real estate ads in Hamilton.
HOUSE for sale. 9 rooms, hardwood floors, good furnace, new garage and driveway, Price $7,200. Apply after 6 o’clock at 278 Rosslyn Ave. N. Early possession.
Let’s do the math and compare 1947 to 2021, shall we?
(Keeping in mind I went all of grade five thinking any number multiplied by zero equalled one…)
Pricing the real estate market is complex and can’t be translated simply by calculating by inflation, but, for simplicity-sake, according to the Bank of Canada, $7,200 in 1947 is equivalent to $89,124.32 today.
According to HouseSigma.com, a four-bedroom, two-bathroom home on Rosslyn Ave N. now would fetch an average of $540,280–which would be considered to be on the “cheap” end of Hamilton’s real estate prices. According to Remax, the current average cost of a home in Hamilton is $646,667.
In around 1947, the average Hamilton salary was about $2,300 per year. In today’s dollars, that would be around $27,000.
The actual average income in Hamilton now is around $33,000.
In other words, a house in 1947 would cost a single person about three-times their annual salary. In 2021, the average home will cost the average person nearly 20-times their salary. Factor in the required down payments, stress tests, and taxes, and that number seems even larger.
What’s the point of all this?
Just that real estate, especially in Hamilton, is expensive.
Which you already knew, but now you have figures to show your grandfather the next time he mocks your generation and tells you to “pull yourself up by your bootstraps” and “figure it out” the way he did… in 1947.
BentallGreenOak Raises $1 Billion for Real-Estate Lending Fund – BNN
(Bloomberg) — BentallGreenOak has raised 869 million euros ($1 billion) for its latest European real estate debt fund as the private equity firm muscles in on property lending amid a retreat by banks.
The fund, which started raising cash before the onset of the pandemic, exceeded its initial target of 800 million euros, according to a statement Thursday. It issues loans secured against offices, warehouses and homes in Germany, the Netherlands, the Nordics and Ireland.
“Post-Covid we have faced a lot less bank competition on the lending side,” said Jim Blakemore, a London-based managing partner and global head of debt. “This is a good market to be a lender in today.”
The outbreak prompted banks to make hefty provisions for soured loans as widespread lockdowns threatened borrowers’ rent collections and their ability to repay loans. That’s diminished their appetite for new real estate lending, particularly to malls, stores and hotels that have seen their income wiped out. Non-bank lenders have spied an opportunity to step in and back investors seeking to reinvent those impaired properties.
GreenOak Europe Secured Lending Fund II has so far lent 382 million euros, the statement said. The eight loans agreed to date have been for properties in the Netherlands and Ireland.
“This crisis may be for assets that are no longer fit for purpose,” like shopping malls leased to fashion stores that have seen consumers move online, Blakemore added. “When you talk about sectors having to be reinvented, that kind of real estate transformation doesn’t fit well with bank lending, that’s the place where private credit can fill the gap.”
©2021 Bloomberg L.P.
Canada's million dollar real estate club grows | Watch News Videos Online – Globalnews.ca
Move over Vancouver there’s a new member of the million dollar real estate club. A day after Vancouver reported a 73 percent jump in sales for February , Toronto numbers jumped over 50 percent with the average price of a home topping the million dollar mark. Financial analyst Michael Campbell has the details.
Ottawa real estate market sets record in February – CTV Edmonton
Ottawa’s real estate market remained red hot during a cold and snowy February, setting a record for properties sold during the month.
“Resale properties are virtually flying off the shelves,” Ottawa Real Estate Board president Debra Wright said in a news release.
The board reports 1,390 residential properties were sold in February, up from 1,134 in February 2020.
The sales volume for residential properties and condos in Ottawa was $885,592,105 in February, 54 per cent higher than the same month last year.
“Even though our inventory is significantly lower than 2020 – a combined 46 per cent decrease in housing stock for residential and condos – we witnessed a record number of sales in February 2021,” said Wright.
“How is that possible? Simply put, properties that come onto the market are selling very quickly.”
February’s sales included 1,028 in the residential-property class, and 362 condominium-properties.
The Ottawa Real Estate Board says the average number of days on the market for a property declined from 30 days in February 2020 to 14 days last month.
The average sale price for a residential-class property was $717,914, an increase of 27 per cent from a year ago. Condominiums sold for an average of $407,671, an increase of 17 per cent from February 2020.
“There is no denying that scarcity is leading to a more rapid price acceleration,” said Wright about the sales volume for residential and condo properties.
“This scarcity combined with buyer’s willingness to pay and compete in this market will continue to drive up the sales prices.”
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