Good news for luxury condominium owners in Toronto and Montreal.
According to a luxury housing market report from Royal LePage, the condo markets in Canada’s two largest cities appreciated 10.2% and 8.4%, respectively, through the 12 months preceding January 31. The average price in Toronto reached $2,268,571, and in Montreal it rose to $1,295,401.
The market for luxury detached houses in Toronto witnessed a 40% drop in sales activity and, consequently, average prices rose a paltry 3.1% to reach $3,575,702. Montreal’s luxury housing market appreciated 5.4% year-over-year, hitting $1,680,942.
The luxury market in Vancouver, however, has seen better days. During the aforementioned period, luxury condominium sales in Greater Vancouver decreased 32.2%, as did prices by 0.6%, for an average of $2,680,064. Greater Vancouver’s luxury housing market also dropped 1.7%, but the cost is still Canada’s highest at $5,751,928. The report read:
“Across Canada’s five largest cities, Greater Vancouver was the only city to post a decline in median luxury home prices. The number of luxury houses trading hands declined over the past two years, a trend that initially began with the introduction of measures to cool the city’s real estate market in 2016. Luxury home values have dipped but remain remarkably steady as many Vancouverites refuse to sell at what they perceive as a discount. Exasperating soft demand, Chinese nationals, an important luxury buyer demographic, have seen restrictions placed on their ability to transfer wealth to Canada.”
Calgary’s luxury housing market climbed to $2,012,676, a 3.2% boost, during the 12 months ending January 31, 2019, however, the city’s luxury condo sector was basically flat, growing 0.5% for a price of $903,106.
Ottawa has had a scorching real estate market as of late, as reflected by the price gains in its luxury segment. Detached houses rose 5% in value, with the price hitting $1,811,716, while the city’s condo market saw a 3.8% at $1,005,549.
Low inventory driving demand for luxury condos
Elli Davis, a sales representative with Royal LePage Real Estate Services Ltd., told CREW that, in addition to low inventory in Toronto’s luxury condo market, boomers are driving sales.
“There were fewer listings available in the larger suites, so there was higher demand for them and, therefore, that often resulted in multiple offers last year, which drove up the sale prices,” she said. “This spans the entire luxury market but it was pronounced in units over 2,000 square feet, which are the type of suites boomers go for because they’ve just sold their family homes but want something equally beautiful, just with a different lifestyle.”
Measures brought in by provincial governments in Ontario and British Columbia have curbed foreign buyer activity in Toronto and Vancouver, and the spoils have gone to Montreal.
“Provincial measures to dampen foreign buyer activity in Toronto and Vancouver have increased demand for luxury property in Montreal, but this demand is mostly seen within the downtown condo market,” Marie-Yvonne Paint, a Royal LePage Heritage real estate broker, said in the report. “We are seeing an increase in demand for presale condo units where investors will buy several units to benefit from a discount.”
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