Toronto’s luxury real estate market is reportedly witnessing handsome growth in recent times. The market is seeing higher activity, particularly in the luxury category and consumer confidence seems to be higher in the entire area according to studies. The sales figures for the luxury realty market in the Greater Toronto Area (GTA) have been stable as compared to the fluctuations of previous years. Sales volumes for properties priced more than $1 million have come down only by 2% on a year on year basis for January and February 2019. MLS sales transactions came down by 38% in the year 2018 due to lower inventory of properties priced above $4 million and a shift in luxury realty deals to private avenues and off-market sales channels.
Demand, however, remains strong for luxury real estate in Toronto as the city heads into spring. Vancouver, on the other hand, has seen a decline of 52% in the home segment with prices above $1 million while sales figures have come down by $4 million for the segment with prices above $4 million. However, a revival of the luxury realty market seems likely soon according to experts. Montreal should have a more stable luxury real estate market this spring after posting stellar growth last year overall. For January and February 2019, Montreal had sales volumes going up by 6% and 53% in the categories of homes priced above $1 million and condominiums priced above $1 million respectively. Prices of luxury real estate in Calgary came down by 33% (year-on-year) overall.
According to experts, the luxury real estate market in Toronto has witnessed strong gains in terms of sales and should perform really well in the spring of 2019. Sales volumes will naturally be affected by the overall inventory that is available and demand from buyers will keep rising accordingly.
Key luxury market trends worth noting
Here are some of the key trends in the market worth noting if you’re a prospective luxury real estate buyer or enthusiast.
• Population growth remains positive throughout Canada and is a major factor behind the rise in demand for luxury real estate in major cities. Population growth in Vancouver, Toronto and Calgary have been 1.6%, 2.5% and 2.1% respectively, all of which are higher as compared to the national average.
• The Bank of Canada is expected to keep overnight rates fixed at 1.75% for some time although rates may be rolled back or stabilize further this year. A steady borrowing cost or lower rate may lead to higher demand for luxury property not just in Toronto but other parts of Canada as well.
• The GTA (Greater Toronto Area) comprises of Halton, Durham, Toronto, Peel and York among other regions. The luxury real estate market should do well in the spring and consumer activity and overall sales transactions are forecasted to cross sales levels witnessed last year.
• Real estate sales transactions for single family homes, condominiums and attached homes priced above $1 million in the GTA have remained relatively on the stable side as compared to the year 2018 as compared to January and February in 2019, coming down by just 2% as mentioned above and with sales transactions of 1,497 units.
• Sales figures of housing units priced between $1-2 million came down by around 1% and sales volumes for homes priced between $2-4 million decreased by 5%. Sales figures of luxury homes priced above $4 million came down by 38% to stand at 20 units.
• Sales volumes of homes priced above $1 million remained steady for January and February 2019 with 690 units sold in all. Sales volumes for properties priced between $1-2 million went up by 7% to stand at 565 units. Sales figures for homes priced between $2-4 million came down by 21% however. There was also a dip of 29% in sales volumes for homes priced above $4 million and 17 units were sold in total.
• Condominium sales in the luxury category went up by 12% as compared to the year 2017 while there was an increase of 33% in case of homes priced above $4 million. The market for condos in the GTA which are priced above $1 million looks rosy as per several experts.
• Over January and February 2019, sales figures for condos priced above $1 million went up by 7% to stand at 145 units in case of the Greater Toronto Area (GTA) and went up to 134 units for the City of Toronto which indicated an increase of 3%.
• There is huge demand forecasted for attached homes with prices above $1 million this spring and sales of units over $1 million saw growth of around 40% in the Greater Toronto Area to touch 182 units on a year on year basis early this year. Sales also went up by 55% to stand at 157 units in the City of Toronto.
The gains in overall population and overall hurdles for affordability will restrict access of customers in case of attached properties and single family units. This will spur demand for condominiums, especially for bigger housing units and in the urban core zone. Sales volumes for housing units priced over $1 million came down by 8% in January and February 2019. Total transactions stood at 1,170 units for the GTA (Greater Toronto Area) and came down to 399 homes in the City of Toronto which indicates de-growth of 13%. Ontario is expected to witness major growth in employment all throughout 2019 and economic growth of roughly 2.1% is also anticipated as per several studies and reports. This spring, the luxury real estate market should continue doing quite well in the GTA according to experts.