Economic optimism drives Hamilton buying boom

[SteelTown]

Economic optimism drives Hamilton buying boom
No. 2 in Ontario for real-estate buys

October 02, 2009
Meredith Macleod
The Hamilton Spectator
http://www.thespec.com/News/Business/article/645970

A new entrepreneurial spirit that is breathing life into a once-battered economy is the reason Hamilton has become one of the province's top real estate bets.

The Real Estate Investment Network has named Hamilton the second-best place in Ontario to buy a house or invest in commercial property.

"Known formerly as a hard-working steel town, Hamilton has transformed itself into a diverse economy," says the Top Ontario Investment Towns report released today.

"An entrepreneurial spirit has entered the city as it puts the wheels in motion to create a major high-tech industrial park, in conjunction with growth at McMaster University. In fact, Hamilton's leadership has been very innovative in terms of its revitalization plans throughout the city."

Don Campbell, president of REIN and author of Real Estate Investing in Canada, said today's investors must be selective and should target cities with the greatest potential.

"The years of skyrocketing prices are finally over; however, over the long term, the economic fundamentals of these key regions will help their property values dramatically outperform other regions of the province."

Campbell told The Spectator that Hamilton is finding new life after serious shocks to its manufacturing heart.

"Some cities will lose their industry and sit in a corner and cry and never come back."

The city's economic development department is celebrating another win earlier this week.

Hamilton was ranked seventh among Canadian metropolitan areas in attracting new and expanded corporate facilities.

Site Selection Magazine, a North American publication aimed at corporate real estate executives, tallied 13 corporate projects between June 2008 and May 2009.

The rankings are based on projects per capita, investment per capita and job creation.

Neil Everson, the city's director of economic development and real estate, says the recognition these kinds of studies bring "goes a very long way to changing people's perception and image about us ... it gives credibility to our marketing efforts."

The REIN study analyzed 13 economic measures, including average income growth, population growth, job creation, affordability, economic diversification and infrastructure.

Researchers also visited the top cities, talked to local economic development staff and listened to conversations in coffee shops, Campbell says.

It's about the future, not the past and not even the present, he says.

"Every city has to get over its past reputation and these rankings are totally objective.

"We put out the first study 17 years ago and Barrie and Orillia were the best back then. People thought they were just cabins and cottages, and look at them now."

The last survey, in 2007, ranked Hamilton at fifth in Ontario and before that it was eighth.

A mix of good news and bad news is actually a good sign for a revitalizing city, Campbell said on the day after the latest bid to bring an NHL team to Hamilton fell short.

"When everything is positive, you know something is coming around the corner."



Top 10 investment towns

1. Kitchener/Waterloo/Cambridge

2. Hamilton

3. Simcoe Shores: Barrie/Orillia

4. Brampton

5. Durham Region: Whitby/Pickering/Ajax

6. Ottawa

7. Brantford

8. Toronto

9. Vaughan

10. Whitchurch-Stouffville

Source: Real Estate Investment Network, Top Ontario Investment Towns, 2009-2014


Top Canadian metro areas for corporate facility projects, June 2008-May 2009

Calgary 37

Vancouver 37

Toronto 34

London 19

Montreal 18

Quebec City 16

Hamilton 13

Wood Buffalo (Fort McMurray), Alta. 8

Saskatoon 6

Halifax 6

Source: Site Selection Magazine

[markbarbera]

What a refreshing article to read, given all the negative, doom-and-gloom postings that have been placed here over the past few weeks. Sometimes one cannot see the forest for the trees.

[highwater]

Ok then. Guess I'll pass on my 'housing bubble' post.

[adam]

I'm surprised Ottawa didn't even make it on the list of metro areas... no Winnipeg either..?

[bigguy1231]

It's called speculation. When your at the bottom the speculators see that and know the only way to go now is up. Lets hope they make lots of money and soon.

[holymoly]

Not necessarily, when it comes to REIN's recommendations. REIN (and founder Don Campbell) focus primarily on a buy-and-hold strategy when it comes to real estate investment, not speculation and flipping.

[adam]

Originally Posted by bigguy1231

It's called speculation. When your at the bottom the speculators see that and know the only way to go now is up. Lets hope they make lots of money and soon.

Your comment suggests that Kitchener/Waterloo is at the absolute bottom of the barrel... and that Toronto is 8th from the bottom of the barrel... did you even read the rest of the list?

[BrianE]

I think Bigguy is half right, it's not that Hamilton is at the bottom it's that Toronto and the GTA is hyper extended past it's top. Investors (home buyers, speculators, people... whatever) can't find any value in Toronto real estate. $750 000 gets you a fixer upper in toronto, only suckers bite on those houses. The smart money goes where the value is, that's Hamilton.

This is a mix of good and bad news really. Good in that Hamilton is finally getting some recognition as a City with amazing housing stock. Bad in that it shows how over valued the rest of the GTA is and how prime it is for pull back.

[SteelTown]

Hamilton Top Place to Invest in Ontario

Diversified economy responsible for top ranking

HAMILTON, ON, May 10 /CNW/ - Calgary based Real Estate Investment Network of Canada today ranked the City of Hamilton as the top location in which to invest in Ontario (2011-2015). As part of REIN's extensive assessment of Canada's top investment locations, Hamilton, along with its top Ontario ranking, was also named #3 in all of Canada.

"Known formerly as a hard-working steel town, the city has quickly shed this image in the eyes of potential investors - as indicated by the record breaking building permit values Hamilton has experienced in recent years," said REIN President Don Campbell. "The wheels have been set in motion to create a major high-tech industrial park in conjunction with growth at McMaster University, sparking an entrepreneurial spirit in the city."

The detailed REIN investment report identifies cities, towns and regions poised to outperform other regions of the province over the next 5 years. As part of the research into this Top Investment Cities list, REIN considered the following key fundamentals: Is the area's average income increasing faster than the provincial average? Is the area's population growing faster than the provincial average? Is the area creating jobs faster than the provincial average? Does the area have more than one major employer? Is the area in the RBC Affordability Index Hot Zone (25% to 39%)? Will the area benefit from an economic or real estate ripple effect? Has the political leadership created an economic growth atmosphere? Is the Economic Development Office progressive and helpful? Is the area's infrastructure being built to handle the expected growth? Are there any major transportation improvements in the works? Is the area attractive to Baby Boomers' lifestyle? Is there a short term problem occurring that is slated to disappear in the future? Is there a noted increase in labour and materials cost in the area?

"This is further proof that the diversification of Hamilton's economy is starting to pay great dividends," said the City of Hamilton's Economic Development Division Director Neil Everson. "We're thrilled with the ranking and encourage investors to contact us to learn more about one of Ontario's hottest economies."

http://www.newswire.ca/en/releases/a.../10/c3087.html

[DC1983]

Let's just hope that once these Investors reach Hamilton, they don't get blocked by our backwards-thinking Mayor, City Council & Staff ie: Trinity (incinerator ppl)

[Duckyboy]

Originally Posted by DC1983

Let's just hope that once these Investors reach Hamilton, they don't get blocked by our backwards-thinking Mayor, City Council & Staff ie: Trinity (incinerator ppl)

Bear in mind, "Property Investment" is not the same as "Buying a house to raise your family in". Many people invest in Hamilton because it's cheap (except for the property taxes) & there are LOTS of people willing to rent. I own 2 rental properties in the city (and live here, too), and I know a few other people who live outside the city who own properties as well. And their logic is exactly the same... (simplified, of course!)

Hamilton > no jobs > lots of people on welfare/assistance/disability > lots of low-income people > cannot afford to buy a home > must rent > therefore, as an investor, there are cheap house prices > chop them up into multi-unit houses > rent them out to people who will always have to rent for their entire lives AND the rent is guaranteed (for the most part) because they are being paid by the government.

The guys I know say they'll keep holding onto them as long as there is loads of people on social assistance... easy money. Sit back and collect the rent without any fear of them moving on to home ownership.

And the sad thing is this... that income is coming from Hamilton citizens (property tax which helps pay for the welfare cheques) and going out of the city (out-of-town owners spending their money in Oakville/Burlington/Toronto).

At least I'm keeping the money in town, but still... that is the "word on the street"!

Don't get me wrong, I love any kind of attention Hamilton gets, but let's keep our heads on straight here.

[thistleclub]

Yeah, these sort of stories always come off with a whiff of "Hamilton: Canada’s Capital of Can't-Miss Property Speculation" to them. (It's even an explicit selling point of the Hamilton Grand.) And of course we've seen how winningly that kind of thinking has served the city in the past.