Hamilton Rents Not Dropping?

[StEC]

So I've seen a bunch of reports that state Toronto's apartment rental rates are at a 4yr low with the average 1 bedroom unit going for $1700.

Why are we not seeing price drops in Hamilton? I haven't been able to find any articles with a Hamilton centric take on the issue explaining the key differences? Our prices still seem to be going up? Anyone care to share their thoughts as to what's going on?

[Innsertnamehere]

My understanding is that the real estate market in COVID has largely been the result of people leaving Toronto and moving out to the 905 / 519 / 705 area.

So rents in Toronto have dropped, while basically anywhere within 150km of the city has seen rents increase as people move outward.

So that would be my bet - rents aren't falling in Hamilton because the rate of people moving here from Toronto has increased.

[StEC]

Okay that makes a lot of sense then. Can these people hurry up and all move back to Toronto to take advantage of the cheap rents so ours can come back down lol.

[TheRitsman]

Originally Posted by Innsertnamehere

My understanding is that the real estate market in COVID has largely been the result of people leaving Toronto and moving out to the 905 / 519 / 705 area.

So rents in Toronto have dropped, while basically anywhere within 150km of the city has seen rents increase as people move outward.

So that would be my bet - rents aren't falling in Hamilton because the rate of people moving here from Toronto has increased.

That and people have been moving into Hamilton in numbers way above the supply. Toronto is building absolute shitloads of housing, so even a slight decrease in people moving into the city would affect it. Add to that immigration has all but stopped, and majority of those immigrants go to Toronto.

[HolyWayne]

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[woreg75]

Good morning everyone,
Just wanted to share a trend that I'm noticing over the last year with rentals downtown, especially our neighbourhood around Queen and Hess.

My husband and I manage a building downtown Hamilton that for many years where filled with seniors who had lived in the building for 30+ years.

In the last year alone, 10 units which contained single occupancy of someone over the age of 90 have been replaced with 9 couples and one single professional all between the ages of 24 - 32.
Up until a few years ago, mostly baby boomers would only apply.

Major turn-around in this building never seen before. People would not move unless sadly to a LTC home or darkly permanent.
In the next year, we can foresee another few units opening up as this pandemic has really exhausted many seniors who live on their own. Some have even said they are thinking of moving in with family.

In the area, there are other buildings managed by Effort Trust and other independent companies.
Their buildings too have had many new younger couples join our neighbourhood. We have all noticed a change and talk about it over yard work from one side of the street to the other.. Many home conversions on the street contain younger renters now, and the young dog walkers are plenty.
(Don't get me started on dog poop)
However it is nice to see that there is a vibrancy waiting to start again once things get to a new normal.

Rents have become crazy, and sadly we are told what to list the vacant unit at, literally moving up month after month, until the pandemic hit.
Worse that we have to be the face of this greed.
Because really.. That is what it has become.
It's an awful feeling having to say the rent price out loud when the same
apartment 5 years ago was half the price.
We would say to each other that no one is going to rent at these prices in Hamilton..

But they do..

Each building in the area watches each other, and adjusts the price, sometimes I swear they are following us as they adjust their price within a dollar of what we offer.

Interesting to note, that many new residents have moved from out of town. Some returning home, but many are new to the city.
Yesterday our first young international transplants eager to call our place home placed a deposit down, and are waiting nearby for the apartment to be ready.

With the prices, we are seeing more couples moving in together who really take pride in where they are living.
I hope this trend continues with the pride, however I would hope to see the rents stabilize in the future.

I really am curious to know if this is all across the downtown area, and even more curious to see if there has been a bit of a change in the next census..
Something is happening for sure, and I'm hoping it will only be positive in the end.

We shall see..

[TheRitsman]

I'm seeing it happen anecdotally, and I think it's overall a good thing. I also hope we build housing that gives these seniors somewhere to live that doesn't force them into further isolation in the suburbs.

We own a duplex and just rented out the second unit to a single woman making really good money. While I do think people are working in Hamilton more at well paying jobs, I also think many are like our tenant, who works for a company in Toronto but from home.

[Good Baklava]

I’m curious about what the average Hamiltonian thinks about the influx of priced-out Torontonians. I understand there is a mix of opportunities and drawbacks associated with this trend. I’m asking what people look forward to and what they fear.

[StEC]

Originally Posted by Good Baklava

I’m curious about what the average Hamiltonian thinks about the influx of priced-out Torontonians. I understand there is a mix of opportunities and drawbacks associated with this trend. I’m asking what people look forward to and what they fear.

I'm of two minds on this issue...

1. I love that people are making Hamilton their home. It's bringing more people to support our local businesses and to create new ones. Downtown is finally shaking off the dirt & grime and is quickly becoming a vibrant place to live, work, eat & play!
   
2. Sadly the downside is our housing supply is way behind the ball and home prices & rents are just out of control which is only punishing locals and maybe pushing them out of their own city which isn't fair.

I don't know who would be responsible or if it would be a combination of both the city and province but some regulations need to be put in place to strike a fine balance here. And red tape needs to be cut and incentives need to be given to speed up approvals & entice construction to meet some of this demand while also guaranteeing a set amount of (I don't want to say market rent because it's all out of whack right now) below market rent units.

[Good Baklava]

Thanks for sharing! So you like how the character of the city is changing, but have concerns about affordability. I had somewhat wondered if there was a conflict between what Torontonians wanted in Hamilton, and what Hamiltonians want for themselves, although at the present there appears to be some optimism from locals.

There seem to be 2 schools of thought on this forum, with one saying include affordable units and another rather having cities allow developers to build more and do away with inclusionary zoning. To go a step further, some say below market rent units are not enough, and instead wish for off-market social housing. The latter is a difficult sell for the public though, so most local politicians would rather champion subsidising market units. Provinces, whether PC or Liberal, don’t want to bother with housing in a meaningful way. Historically, we had seen a delegation from Federal, to Provincial, down to Municipal responsibility for housing in a game of “hot potato”. The Federal Government has recently stepped back into the game, although at the present I’d argue their role is limited compared to what it could be.

[thistleclub]

Hamilton's rental supply is concentrated in the old city, with most of that supply located below the escarpment between the 403 and the RHVP. Rental rates in some of those those communities are basically the inverse of the city as a whole, with something like 2/3 of residents of Wards 2 & 3 renting and 1/3 owning, while Hamilton's city-wide rates are basically 2/3 own, 1/3 rent. Add to this the historic devaluation of real estate in those same areas, mixed in with precarity/poverty rates and you have a problematic set-up for a runaway housing market and the explosion of investment properties.

For decades, banks and buyers had a jaundiced view of these areas, but now the market dynamic scans as Canada's last can't-miss-get-rich-quick scenario. This seller's market has impacted historic rental stock as large houses in neighbourhoods like Stinson that might have been subdivided into rental units have seen owners sell, while many mid-rise and high-rise rental buildings have been converted to condos, taking them out of the galaxy, or flipped to REITs who look at an apartment as a financial instrument.

Wards 2&3
2001: 79,335 population in 38,800 dwellings
2016: 74,890 population in 41,070 dwellings

Supply is relative.

[thistleclub]

Courtesy CMHC Rental Market Reports

Average 1BR Rent, Hamilton CMA / Urban Hamilton / Downtown Core
1991: $458 / $440 / $459
2001: $608 / $574 / $578
2011: $722 / $659 / $668
2016: $869 / $810 / $837
2020: $1,096 / $1,027 / $1,068

Total Rental Units, Downtown Core
1991: 11,549
2001: 10,502
2011: 10,126
2016: 10,236
2020: 10,171