While the COVID-19 crisis has created a new wave of uncertainty across Canada’s real estate market, a new data report has determined that the luxury housing markets in the Greater Toronto Area, Vancouver and Montreal are facing the challenge from a strong position.
According to a new study from Sotheby’s International Realty Canada, the Greater Toronto Area’s residential real estate sales over $1 million during the first two months were up by 107% year-over-year, while luxury sales over $4 million surged 75% during this time. Although inventory was limited, gains were recorded in the $1 million-plus condominium market (up 117%), attached home sales (up 52%) and single-family home sales (up 115%).
Furthermore, the market saw the sale of six condominiums priced at over $4 million in the first two months of the year, compared to one during this period in 2019, while single-family home sales over $4 million soared by 71%. Preliminary sales data for the first 15 days of March saw overall $1 million-plus and $4 million-plus sales up by 94% and 56%, respectively.
Vancouver’s luxury market responded to pent-up demand with dramatically increased sales activity for luxury condominiums (up 65%), attached homes (up 109%) and single-family homes (79%). This resulted in an overall 80% increase in residential sales over $1 million in January and February, while luxury sales over $4 million saw an increase 78%. However, $1 million-plus sales pulled back 19% year-over-year in the first 15 days of March.
Montreal’s luxury real estate market was up by 68% year-over-year in the first two months of 2020, while sales over $4 million rose 50%. Soaring sales were recorded for luxury condominiums (up 92%), attached homes (up 63%) and single-family sales (up 60%). In the first 15 days of March, sales over $1 million increased a more modest 15% from the same period in 2019.
“Canadians are confronting unprecedented and historic times, and concerns for our collective health, economic prosperity and personal finances are running high,” said Don Kottick, president and CEO of Sotheby’s International Realty Canada. “In spite of these monumental global forces, the most recent conventional and luxury real estate market data reveals that many of our country’s key markets are facing this turbulence from a solid foundation.”
Kottick predicted that “a shortage of listings inventory, pent-up consumer demand, and regional economic fundamentals position these markets for resilience in the months ahead. Furthermore, historically favourable mortgage lending conditions and extreme stock market volatility make Canadian real estate a desirable and secure investment. While uncertainty lies ahead, housing will remain essential, activity will continue and the long-term prospects for Canadian real estate are solid.”