Average home sale prices in the lower central city have crossed the $200,000 threshold for the first time on a big jump in value last year.

Hamilton Centre had an average sale price of $202,011 in 2014 on 1,461 sales. That was an increase of 14 per cent over the average of $177,044 in 2013.

The figures were released Friday as part of the Realtors Association of Hamilton-Burlington's 2015 forecast. The board covers all of Hamilton, Burlington and Grimsby, and the Haldimand County communities of Caledonia and Dunnville.

The overall average for the board's area was $406,432, up 5.9 per cent over the year before. Sales were also up 6.4 per cent to 14,296, a new record, on 19,580 listings.

Hamilton Centre, which stretches from John Street to Kenilworth and from the escarpment to Hamilton Harbour, led the way in price hikes over the previous year, followed by Stoney Creek (9.1 per cent) Hamilton West (7.8 per cent), Hamilton East (7.8 per cent) and Hamilton Mountain (7.2 per cent).

The highest average price in 2014 for the local board - $525,377 - was in Flamborough. But that's also the only area in the board's jurisdiction to see average price fall from 2013, a drop of 1.5 per cent.

The board expects another strong year in 2015, predicting 14,500 residential property sales, 20,000 listings and an average price increase of 3.5 per cent.

The biggest challenge for the market is a continuing shortage of listings. Hamilton had the tightest market in the country in 2014, a testament both to a dearth of for sale signs and the level of demand.

The shortfall is across all housing types, says RAHB CEO Ross Godsoe. The board expects the listings shortage to continue through 2015, which can be frustrating for buyers on the hunt.

"Our area has been in a sellers' market, to varying degrees, for over 10 years and 2014 was the tightest market we've seen in 10 years," said board president Donna Bacher.

She says the pickings are so slim that realtors practically sleep with their laptops, waiting to pounce on new listings. Investors looking at buying income properties find there is little available, she says.

While listings grew marginally over the previous year, Bacher says they just aren't keeping up with demand. Yet homebuyers are remaining "level-headed" and "rational" when it comes to the price they are willing to pay, she said.

The board says the Hamilton-area market will remain stable in 2015, thanks to low interest rates, a "positive employment picture" and relative affordability compared with the GTA.

But there is no doubt the area's home prices are climbing quickly.

According to a decade's worth of sales data from RAHB, the strongest price jumps have come in Burlington (73 per cent), Hamilton Centre (70 per cent) and Hamilton West (68 per cent).

The slowest price gains in the board's area have come in Caledonia (28 per cent) Flamborough (33 per cent), Dunnville (36 per cent) and Glanbrook (38 per cent).

Some worry that climbing prices, especially in areas of the lower city, will make home ownership impossible for first-time homebuyers or those with modest wages. The city is now fourth behind Vancouver, Toronto and Montreal in terms of the gap between average home prices and average incomes.

But Bacher says Hamilton is still a great deal because there is a wide variety of housing stock available.

"Two people with $30,000 incomes can buy in Hamilton in nice areas with a great sense of community, beautiful architecture and great amenities."

Plenty of attention has been heaped on Hamilton's real estate market over the past few years, largely thanks to an influx of those unwilling or unable to play Toronto prices.

A TD Economics analysis published earlier this month predicted Hamilton will be the only one among Canada's largest 14 cities to see house prices grow over the next two years.

"Unlike other markets, where we see prices decline, we do see prices growing by about two or three per cent per year in Hamilton," wrote Diana Petramala, TD's real estate economist.

"The sharp gains we've seen are probably behind us, but it's still going to be one of very few markets where home prices will continue to grow."

Loading... Loading... Loading... Loading... Loading... Loading...

Godsoe says an indicator realtors watch closely is average days on market, which dropped from 44 days in 2013 to 39 days last year.

"From a realtor's perspective, one or two less on the market is quite dramatic. This was a huge drop."

Together with commercial property sales, the board's total volume of sales hit more than $6.1 billion in 2014, an increase of more than 13 per cent over the year before.