Real estate transactions in the $1-million-plus category rose by (on a year-over-year basis) 48 per cent in Toronto, 46 per cent in Vancouver, and 15 per cent in Montreal. Conversely, sales volume in Calgary went down by 41 per cent over the same period.
According to Sotheby’s, these wildly different levels of performance pointed at a larger trend: A major divergence in the markets themselves, fuelled by various factors—including inventory, demand, consumer confidence, and low interest rates—that have propped up some cities and hampered others.
As one of Canada’s leading markets, continuous growth in the over-$1-million and over-$4-million residential categories in the Greater Toronto Area can last well into spring 2016. Vancouver is also projected to enjoy similar gains, which would push the issue of housing affordability into greater focus.
“Luxury home sales in Toronto and Vancouver will continue to defy gravity this spring. Both markets have the potential for significant gains, and we expect heightened demand and insufficient inventory to drive price escalation and sellers' market conditions,” Sotheby's International Realty Canada president and CEO Brad Henderson said, as quoted by Market Wired
Meanwhile, steady performance in Quebec would mitigate the worst effects of the oil shock on the Montreal market. Calgary won’t be as fortunate, however, with lethargic national and global economic growth continuously wearing away at consumer confidence—especially in light of the OECD’s recent downgrading of Canadian growth prospects, from 2 per cent to 1.4 per cent.
In its January 2016 report, Sotheby's International Realty Canada pointed at possible huge gains in the Toronto luxury real estate market, with Vancouver to post respectable increases, Montreal to remain stable, and Calgary to weaken.