Transit projects in Hamilton having significant impact on housing prices
A report released by Canadian Mortgage and Housing Corporation (CMHC) last week found that GO Train expansion projects in Hamilton have had a significant impact on housing prices.
The report looked at how the market was affected in the immediate aftermath of the announcement of the West Harbour GO development and Confederation Station.
West Harbour was completed in 2015 and Confederation Station is nearing completion.
"The Hamilton-Niagara GO stations increased house prices in the areas they were planned by up to $40,000," said senior analyst Anthony Passarelli in the report. "In some cases, those price increases occurred even before construction began."
According to the data provided in the report, the West Harbour GO station increased house prices in Hamilton Centre by up to $30,000, or nine per cent.
CMHC came to this conclusion based on comparisons with neighbourhoods that had similar housing prices and pricing trends prior to the development announcement.
Most of the estimated price increase from the West Harbour GO station occurred between the project's announcement (May 2013) and completion (July 2015) dates, the report says.
Since the completion, the report says that "the price increase attributed to the West Harbour station up to the completion year was just slightly smaller than it was up to the most recent year" suggesting that since completion, prices have relatively stabilized.
The Confederation GO station project increased house prices in Stoney Creek by as much as $40,000, or eight per cent so far.
"Confederation GO station will likely increase prices in Stoney Creek slightly more, as Metrolinx estimates that the project will likely be completed in late 2019 or early 2020," the report says.
In East Hamilton, the impact of the Confederation GO project has seen house prices up by $15,000, or four per cent, compared to similar neighbourhoods.
InTheHammer reached out to CMHC to see if LRT project announcements have had similar impacts on prices in the city but they said they don't have that data as of yet because they don't conduct these kinds of studies until construction is well underway or completed.
A local real estate agent, however, has seen the impact the LRT has on home buyers and sellers firsthand in the areas near the proposed LRT corridors.
Chad Connelly, of Potruff and Oliver Realty, says that buyers and sellers have expressed doubts about whether or not the project will actually get off the ground and have even questioned whether or not it will end up as big a project as they're planning.
"I sense scepticism," he said. "Even when a project on that scale has reached the point of no return, the public thinks it could be cancelled. [It signals] a lack of trust in the political process."
Connelly says that the prospect of prolonged construction has many in the marketplace baulking at opportunities because they don't want to be near it.
"Buyers hope to see value gains in the future when the project is complete," he said. "Sellers want to see value gains now, before it is started. [There's] a slight disconnect."