Canada’s luxury homes market is set for a boost from population growth and rising consumer confidence according to a new report.
Sotheby’s International Realty Canada’s data shows a stabilization of top-tier sales in the GTA with a nominal 2% year-over-year decline in sales over $1 million for the first two months of 2019.
However, for the GTA’s priciest homes – those over $4m – there was a 38% decrease in sales compared to the first two months of 2018.
“Toronto’s top-tier real estate market has gained consistent and steady traction in the early months of 2019, and is primed for healthy spring performance. The ceiling for sales activity will be determined by inventory, as consumer demand continues to rise,” says Brad Henderson, President & CEO of Sotheby’s International Realty Canada.
Pent-up demand in Vancouver
Sales of luxury homes in Vancouver remain weak with decreases of 52% year-over-year for $1 million plus homes and 50% for those priced at $4 million and above.
However, Sotheby’s believes pent up demand will lead to better things ahead.
“Vancouver remains a buyers’ market but has transformed to one where pent-up demand is verging on activity. Consumer interest is solid, and so is confidence in the enduring value of Vancouver real estate. The question will be whether prices adjust to facilitate more transactions this spring, or in a later season,” added Henderson.
Elsewhere, he expects Montreal’s luxury market maintains strong potential to set new records this spring, while Calgary’s top-tier market remains vulnerable to the region’s continued economic downturn, as well as its sharp build-up of housing inventory.
Economic vulnerabilities, interest rates, and affordability remain key factors in Canada’s luxury real estate market.