Hamilton is located in southern Ontario on the western end of the Niagara Peninsula and wraps around the westernmost part of Lake Ontario. It is situated in the geographic centre of Ontario's Golden Horseshoe and is roughly the midway point between Toronto and Buffalo, New York.
It was once a blue-collar industrial town where 60% of Canada's steel was produced. But when one of its main steel producers almost went bankrupt and the city was hit by the recession, many Canadians wrote it off as a ghost town in training.
However, today, Hamilton is proving those nay-sayers wrong. It is breaking through its past, and, in fact, is poised to outperform most of the province as it sheds its past reputation and grabs a hold of the future. A prime choice for future economic opportunity with an educated workforce, stunning natural amenities and a diverse, resilient economy, Hamilton was ranked one of the top five places to invest in Canada by U.S.-based Selection Magazine.
Its economic sectors include advanced manufacturing, agriculture/food processing, creative industries, technology life sciences and transportation. The City of Hamilton will also use $5,386,000 in government funding to improve economic planning and build on the city's diverse industry clusters and strengths. Hamilton is also home to a state-of-the-art health-care system, in which hospitals often specialize in certain fields.
The hospitals have a high degree of co-operation between institutions, making each medical facility teaching hospitals.
Beyond the medical students, Hamilton is also home to a number of outstanding post-secondary institutions - namely McMaster University, Mohawk College of Applied Arts and Technology, Redeemer University College, Brock University - Hamilton Campus and College Boreal - that have been recognized internationally for their research and instructional strength as well as providing local area businesses with a well-educated workforce.
Infrastructure projects such as research and innovation centres and business parks in Hamilton will boost 2011 job growth in the non-residential construction industry and once completed, will generate employment in the region.
According to CMHC's Spring 2011 Housing Outlook, employment in the Hamilton CMA is forecast to increase at a moderate pace through 2011 and into 2012. Modest job growth in the Hamilton CMA will result in average weekly earnings rising at a rate similar to the rate of inflation.
Its strong economy is attracting migrants, which will continue to drive population growth, and thus housing market activity through 2012.
Nearly three-quarters of population growth was due to migration in 2010, mostly from international sources and from other parts of Ontario. International migrants comprised nearly 60% of the total population growth between 2007 and 2010.
The remainder of population growth comes from the natural increase in the population. To accommodate this increase in population, more townhouse and condominium apartment construction is expected when starts rebound in 2012.
The average price of a new, single-detached home will reach $465,000 in the Hamilton CMA in 2011. In just a few short years, the continuing diversification of the city's economy will result in an economy unrecognizable when compared to the past decades. This renewal will drive demand for real estate (rentals as well as ownership) in the city, especially in older neighbourhoods going through transition. Among these: Hamilton Mountain.
Hamilton Mountain, (aka The Niagara Escarpment) cuts through the middle of the city, and is primarily divided into three areas, East Mountain, West Mountain and Central Mountain. The socioeconomic composition of the Hamilton Mountain is diverse, having low-income public housing residents as well as million dollar estates, highly paid unionized workers and small-wage unskilled workers, and well-established families and recent immigrants. When Hamilton suffered from the economic crisis, a lot of people left the Mountain as more businesses and work were found in Hamilton's downtown core.
As a result, the older homes, which make up the majority of the Mountain - namely East Mountain - were unkempt and down-trodden. However, as accessibility around Hamilton Mountain became easier with the development of the Lincoln Alexander Expressway (a.k.a the LINC) and the new Red Hill Valley Parkway, residents could now get from one end of the city to the other within 15 minutes.
These expressways also connected to Hwy 403 at the west end and connected to the Red Hill Valley Parkway at the east leading to the Q.E.W., cutting the commute to downtown Toronto, Mississauga and Oakville. Over the years many people have moved to the area because of new construction homes - Hamilton Mountain will continue to have the most active markets for new home construction of single-detached homes and townhouses given the greater availability of land for development - and resale homes prices are attractive and affordable, compared to areas such as Toronto, Mississauga and Oakville.
In fact, Carolyn Seaforth, principal at Hamilton's Forthright Group, has seen one of Hamilton Mountain's most undesirable streets transform into a spot that has people waiting on a list to call the 'hood home.
"In the past, multi-residential buildings were poorly managed and vacancy rates high," says Seaforth. "Now, with our example, which is the first of its kind, developers can understand that there is a demand for a higher quality rental in Hamilton." Seaforth's current investment opportunity is a totally renovated 46- unit apartment building located at 508 Mohawk East. "When the building was purchased, this building was degraded, rundown, and only 50% occupied and very poorly run," says Seaforth. "We could have called it the nightmare on Mohawk street. Now it is a stateof- the-art, totally energy-efficient paradise with a wait list of 50 tenants wishing they could get in!" It is in the process of condominium conversion and in September its individual investors will take ownership of one- and two-bedroom units for $168,000 and $189,000.
Although these units are less expensive than the average singlefamily home in Hamilton, they are garnering more than the average rent. While the average two-bedroom rent in Hamilton is $839, these two-bedroom units located in the Mountain are renting for $1,060. For investors looking for a single-family home, a good price in the area runs between $250,000 - $270,000, which is still less than the city average.
"Investors are getting a 15% cash on cash ROI," says Seaforth. "And 27% if we assume a modest appreciation of 3%. It's a matter of how quickly developers realize the potential of this area. I think with the attractive government incentives in place, the growth will be quite evident over the next three to five years."
Are you looking to invest in property? If you like, we can get one of our mortgage experts to tell you exactly how much you can afford to borrow, which is the best mortgage for you or how much they could save you right now if you have an existing mortgage. Click here to get help choosing the best mortgage rate