Affordable Rent in Hamilton

As homeowners, we are all happy when our houses rise in value and why not? Who doesn’t like to make money? But what are the long-term effects for all of us? How does it impact affordable rent?

Let’s take a simplistic view:

• Mortgage rates come down and house prices go up.
• Mortgage rates go up, new government mortgage rules are applied.
• Prices stop their climb and in some cases, prices drop.
• Would be buyers hold off buying. Thus, more renters enter the market.
• Demand for rentals is outpacing the supply and affordable rent is impacted. (Fact: rental availability has seen vacancy rates drop since 2016.)
• Finally, housing becomes the biggest expense and it affects other areas of the economy.

Has the above taken place? You betcha!

In Ontario, over 21% of families are spending more than 50% on rent and utilities. That’s one in five! As well, 12% are living in overcrowded situations. Most people are asking how this attack on affordable rent all came about. The answers are very easy. The following two reasons are most instrumental in our problems:

1. The Federal Government has stopped making rental homes since the 1990’s. As well, the private sector was building condominiums over rentals.
2. Landlords have smelled blood. They are no longer required to offer affordable rent.

In the past 10 years, the number one complaint in the Metro Toronto Tenant Association was non-payment. Last year, the number of landlords choosing to make use of their own homes and chase tenants out, exploded. Are some landlords telling the truth? Yes. But most suspects are chasing out the oldest tenants who pay the lowest rents. The landlords are acting in bad faith for the almighty dollar.

Our city and area of Hamilton-Wentworth is no exception. With the explosion of prices in the GTA, rents exploded and now it has had a spill-over effect in our great City of Hamilon. Among Canadian cities, our area was one of the fastest growing in terms of a 14% increase year to year. Common sense is telling us that when buyers can’t buy and renters can’t rent due to prices, it will only slow the local real estate market more until we have some sort of adjustment. Keep your eyes open!

Robert Floris is a Mortgage Broker. His office is located at 651 Fennell Avenue East in Hamilton, Ontario. If you would like to speak with Robert, he can be reached at 905-574-9200 #215. Alternatively, you can contact Robert here.

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Thanks for reading!