Sales of “uber-luxury” residential properties worth $5 million and above are accelerating in the Greater Toronto Area, according to new research by RE/MAX.
“The one consistency in Toronto’s real estate market throughout 2019 has been value – and it’s evident from the bottom end of the market to the top,” RE/MAX of Ontario-Atlantic Canada executive vice president and regional director Christopher Alexander said.
“Homebuyers at virtually all price points – including uber-luxe – are kicking the tires once again. As a result, momentum is building in the overall market, which is reflected in the escalation in sales at both the $2 million and $5 million price points.”
The executive attributed the uptick to a robust economy and record-low unemployment levels, along with more relaxed interest rates and strong returns in the stock market.
“The fog has lifted – buoyed by solid economic factors, but also by the belief that the worst is behind us,” Alexander added. “The housing market has shifted into recovery mode. Luxury home sales are climbing, prices are stabilizing, and demand is on the upswing for upscale product.”
Activity in the high-end segment surpassed 2018 levels, with sales of freehold and condo properties valued at more than $5 million reaching 100 units from January to October. This represented an 8.5% increase on an annual basis.
Freehold properties in this price bracket now fetch an average value of $6,517,143. This is in contrast to the 3% year-over-year decline seen in the city’s single-detached housing market.
Sales of homes valued at more than $2 million went up by just over 9% annually (reaching 1,975 transactions), while activity in the $3 million - $4.99 million sector slowed down by 4.7% year-over-year.
Fortunately for this segment, “sales of luxury properties between $3 and $5 million are expected to climb in the year ahead as the ripple effect works its way through various price points,” Alexander assured.
“Sales at lower price points tend to stimulate sales at the next level, as homebuyers trade-up to larger homes or more desirable neighbourhoods. Our research has found that the spread is narrowing with each month’s sales figures.”