Like many other places across the country, local businesses in Hamilton have taken some of the hardest hits from pandemic closures and restrictions. One side effect of this is that the downtowns that were once vibrant and attractive destinations have diminished in importance when it comes to our housing decisions.
However, with the end of the pandemic on the horizon, many are now taking a more serious look at the role these businesses will play in local economic recovery as well as attracting new residents.
We spoke to Sandy MacKay, a top local realtor from the Hamilton area, about the role local businesses play in real estate in the city and why investors should pay attention.
Hamilton has seen a lot of interest in recent years both from migrants out of the GTA and those from smaller towns looking to move urban. According to MacKay, Hamilton has a lot to offer its new residents, including “affordability and a lower cost of living, yet still within reach of all the GTA has to offer. Hamilton is the closest city to Toronto, which is not part of the GTA, so it’s very attractive to those who want to live a city life, at an affordable cost.”
The challenge now for the city is to offer the same attractive amenities that have made the GTA region so appealing. Though Toronto is a city known for it’s good eats and variety of dining establishments, MacKay highlights how Hamilton has a burgeoning hospitality industry of its own.
In particular, Mackay cites the downtown area of the city both for its businesses and for its real estate opportunities. The area is the heart of local business in the city with a wide selection of businesses to explore. This also has the effect of making it a hot spot for real estate as inhabitants come to live and work in the surrounding neighbourhoods.
“Hamilton has become a hot spot for restaurant owners and chefs in recent times,” said MacKay. “The cost of running a business like this in Hamilton is far less than in Toronto, largely due to the lower cost of space. With the pandemic hitting, and restaurants changing their business models, this has only increased the movement of business out of the GTA and into cities like Hamilton.”
There is also a wide variety of available properties in the area.
“There are plenty of mixed-use and live-work opportunities in these areas,” said MacKay. “Opportunities also exist to convert some commercial units into residential units, where the commercial units are no longer needed. Many of the side streets just off the main streets could work well for this. There are also many multi-family residential units available around these locations, which are still great investments as well”
The hope is that as a local business is reinvigorated by easing restrictions, many more will be drawn to the area to live and work, allowing for businesses to grow and presenting a great opportunity for investors. For now, however, we should support our local businesses where we can as they work through the hard times.
“Hamilton has a thriving young entrepreneurial population. With a diverse economy and proximity to the GTA, there is opportunity in Hamilton for practically every type of career focussed individual.”
The city of Hamilton has already shown huge growth potential in recent years and a look at recent market statistics out of Hamilton proves this fact. In December of 2021, the average sale price for a home in Hamilton rose to $861,695, around a 30% increase from December of 2020. Detached homes averaged at $924803, while semi-detached and apartment properties went for $761,318 and $605,958 respectively. High demand for homes in Hamilton has made housing supply drop in recent years and it currently sits at its lowest level on record.
In terms of affordability, the city is still doing much better than nearby cities in the GTA. For comparison, detached homes in the GTA averaged at over $1.5 million for the same period, with prices for residential properties costing almost 40% more on average than in Hamilton.
For investors looking at Hamilton as a potential spot to put down some money, MacKay says now is as good a time as any.
“Waiting for prices to go down or cash flow to increase is simply not realistic and you most likely will be disappointed in that approach,” says MacKay. “In Q1 we should see more price increases and activity. More and more migration from the GTA into Hamilton should also increase rental and housing demand. We are projecting another strong Q1 and spring market for practically all types of Hamilton real estate.”