TORONTO, ONTARIO--(Marketwired - Jul 7, 2016) - A report released today by Sotheby's International Realty Canada highlighted significant growth in the sale of $4 million-plus real estate in the Greater Toronto Area (GTA) and Vancouver during the first six months of 2016, despite stark contrasts within the $1 million-plus real estate markets across Canada's four major metropolitan centres.
The GTA (Durham, Halton, Peel, Toronto and York) and Vancouver continued to lead Canada's $1 million-plus real estate market as a whole, as robust market fundamentals buoyed year-over-year luxury real estate sales over $4 million. While sales over $1 million soared across the GTA region and the number of units sold over $1 million in the city of Toronto exceeded that within the city of Vancouver, it was Vancouver that saw the greatest year-over-year percentage gains in sales volume over $4 million relative to the city of Toronto proper. Montreal's top-tier real estate market remained balanced and increased sales activity in late spring in Calgary resulted in a modest uptick.
Between January 1 to June 30, 2016, sales of residential real estate over $1 million (condominiums, attached and single family homes) in the GTA rose 65% and 35% in the city of Toronto proper compared to the same period in 2015, while Vancouver's market experienced a year-over-year increase of 26% during the same period. Consumer demand outstripped available inventory and drove bidding wars and overall prices escalation across both markets. The greatest percentage gains in volume were in real estate sales over $4 million: the GTA posted increases of 81%, 73%, and 64% in $4 million-plus, $2-4 million and $1-2 million real estate sales respectively, while Vancouver saw increases of 100%, 21%, and 18% in the $4 million-plus, $2-4 million, and $1-2 million price categories.
Top-tier real estate sales in Montreal maintained a healthy state of balance with a 16% increase in the first six months of 2016 over the same period in 2015. Calgary's $1 million-plus real estate sales saw a modest increase of 9% as the real estate market showed signs of increased sales activity by the late spring of 2016 as motivated sellers entered the market with adjusted prices. Despite this, rising unemployment, decreased migration into the city and continued turmoil in the oil and gas market further impacted consumer confidence.
"Demand for luxury real estate in Toronto and Vancouver remains unrelenting, far exceeding supply in the higher price spectrums of the market," says Brad Henderson, President and CEO of Sotheby's International Realty Canada. "There are signs of gridlock in the market for homes closer to $1 million, now the typical price for a conventional, detached home in both markets. The options for real estate consumers are slim, and this is beginning to reflect in market activity."
According to Henderson, sales gains in the market for real estate over $1 million are expected to continue through the remainder of 2016 across the GTA and Vancouver, with further increases projected in the $4 million-plus segment as local and international demand continues to reinforce both markets' position as global real estate market leaders. With sustained political stability forecasted, Montreal's high-end real estate market is expected to remain balanced into the summer and fall, while anticipated price declines are expected to increase activity in Calgary's top-tier real estate market in fall 2016.
Canadian top-tier real estate market highlights include:
In spite of double-digit price gains, sales activity over $1 million across the city of Vancouver remained elevated in the first half of 2016, characterized by limited inventory resulting from sustained domestic and international demand, stable interest rates, and a weak Canadian dollar. Overall, a total of 3,111 properties (condominiums, attached and single family homes) over $1 million sold across Vancouver, an increase of 26% when compared to the same period in 2015. The most significant sales gains were in the market for real estate over $4 million, which soared 100% to 439 properties sold, as prices in both the conventional and luxury real estate markets saw record-breaking increases during the first six months of the year. With continued inventory limitations and lack of alternatives placing strains on prospective real estate sellers and buyers, the sales of detached single family homes over $1 million saw a more modest increase of 9% in the first half of 2016 with 2,086 units sold. Attached home sales over $1 million increased 79% in the first half of 2016 compared to the year prior, while Vancouver's $1 million-plus condominium market outperformed other major Canadian cities' with a year-over-year sales increase of 95%.
Calgary's top-tier real estate market showed signs of increased sales activity by the late spring of 2016, even as continued uncertainty in the energy sector, rising unemployment rate and a decrease in net migration to the city dampened consumer confidence. Overall, excess supply solidified the city's position as a buyers' market. In total 318 properties (condominiums, attached and single family homes) sold over $1 million in the first six months of 2016, representing a 9% year-over-year increase. Calgary's $1 million-plus detached single family home market saw the greatest activity of the housing types, with 287 units sold in the first half of the year, a 13% increase compared to the same period in 2015, while attached home and condo sales decreased 12% and 38% respectively.
Greater Toronto Area (GTA)
On the heels of 2015, which saw the GTA (Durham, Halton, Peel, Toronto and York) lead Canada in $1 million-plus sales volume with gains of 48% over 2014, the region continued to exhibit strong year-over-year momentum in the first half of 2016. With healthy consumer confidence and robust demand, the GTA's $1 million plus housing market exceeded industry expectations, with a 65% year-over-year increase in sales volume in the first half of the year compared to one year prior, with 10,172 units (condominiums, attached and single family homes) sold. Luxury real estate over $4 million saw the greatest gains in sales volume of the price categories surveyed, increasing 81% year-over-year. Detached single family home sales comprised the most significant percentage of $1 million-plus sales in the GTA and saw the greatest year-over-year percentage gains for this housing type across the country, rising 66% to 9,132 units sold in the first half of 2016. Attached home sales over $1 million experienced a 73% jump, while condominium sales grew 36%.
Within the GTA, the city of Toronto represented the most significant percentage of real estate sales over $1 million, with 4,165 units sold across all property categories in the region in the first half of 2016, a 35% gain over the same period in 2015.
Montreal's top-tier real estate market remained healthy in the first half of 2016 as continued political stability contributed to steady market activity. Stable consumer confidence led to balanced pricing for properties over $1 million in the region. Overall, real estate sales over $1 million increased 16% with a total of 317 units (condominiums, attached and single family homes) sold in the first half of 2016. Balance continued in Montreal's single family home market with a slight year-over-year increase with 170 units sold in the first half of 2016. Attached home and condo sales over $1 million both increased year-over-year, posting 13% and 23% sales gains respectively.
Sotheby's International Realty Canada's bi-annual Top-Tier Real Estate Report examines the market for $1 million-plus residential properties sold in Vancouver, Calgary, the Greater Toronto Area and Montreal. The mid-year report analyzes year-over-year data and key market variables for the first six months of 2016, offering insight into top-tier real estate sales trends in Canada's key urban centres.
About Sotheby's International Realty Canada
Combining the world's most prestigious real estate brand with local market knowledge and specialized marketing expertise, Sotheby's International Realty Canada is the leading real estate sales and marketing company for the country's most exceptional properties. With offices in over 30 residential and resort markets nationwide, our professional associates provide the highest calibre of real estate service, unrivalled local and international marketing solutions and a global affiliate sales network of approximately 845 offices in more than 63 countries to manage the real estate portfolios of discerning clients from around the world. For further information, visit www.sothebysrealty.ca.
The information contained in this report references market data from MLS boards across Canada. Sotheby's International Realty Canada cautions that MLS market data can be useful in establishing trends over time, but does not indicate actual prices in widely divergent neighborhoods or account for price differentials within local markets. This report is published for general information only and not to be relied upon in any way. Although high standards have been used in the preparation of the information and analysis presented in this report, no responsibility or liability whatsoever can be accepted by Sotheby's International Realty Canada or Sotheby's International Realty Affiliates for any loss or damage resultant from any use of, reliance on, or reference to the contents of this document.