Hamilton's new housing market is blowing by the rest of the province with a 24 per cent increase in new builds in July compared with the same month last year.

Overall, new housing starts for single-detached and multi-family homes have increased 13 per cent this year, according to the CMHC. That's scorching compared with Ontario's urban market, which has had a 16 per cent year-to-date drop in new housing and an 18 per cent decrease in July compared with last year.

"When you're looking at the year as a whole, activity is stronger (in Hamilton)," said CMHC market analyst Dana Senagama. "New homes only account for 20 per cent of the housing market. The resale market is extremely strong right now. That means the new home market will do well because of the spillover demand."

There are a few reasons for the spike here, she said, namely the boomers who are starting to downsize, but not necessarily downgrade into new, smaller homes.

"It's the 55-plus age group buying second or third, more expensive homes, it's just the boomer effect."

There are also a few huge residential developments coming on-stream, particularly in the suburbs of Stoney Creek Mountain and Glanbrook.

"As for people moving into Hamilton, especially from Toronto, that is not as strong as it used to be due to the outflow of people to Western Canada."

Prices remain strong in Hamilton as well, Statistics Canada's figures showed yesterday. Hamilton housing prices show a 5.7 per cent year-over-year increase for new homes.

lmarr@thespec.com

905-526-3992