The Toronto real estate recovery is pushing its way up to the luxury home segment, according to a new report by Re/Max.
Year-to-date there has been a nine per cent year-over-year increase in the sub-luxe $2-million-plus market, according to the report. There has also been an 8.5 per cent rise in sales of properties priced at $5 million or more.
The relatively small $5-million-plus real estate category has been heating up after a slow start in the first five months of the year, said executive vice-president Christopher Alexander, who said he has been surprised by the more recent gains.
“We started to see signs of it coming back in early May but it was slow. I didn’t expect to see the numbers where they are today,” he said.
There were 1,975 homes that sold for $2 million or more between January and October of this year, up from 1,809 during the same period last year. In the $5-million-plus category, there were 102 sales in that category this year — up from 94 last year, but down from 173 in 2017.
The Toronto region’s strong economic performance and Canada’s relative stability are again attracting buyers from mainland China and investors from Hong Kong, despite the introduction of foreign buyer taxes, said the report.
While the top and bottom end of the luxury market are gaining ground, Re/Max says that homes priced between $3 million and $5 million are lagging last year’s sales by 4.7 per cent.
The City of Toronto has seen the strongest performance in the luxury market — up 26 per cent to 73 sales compared to last year’s 58 — followed by York Region.
Rosedale and Yorkville are the most competitive neighbourhoods for high-end home buyers, said Alexander. Properties in the upscale York Mills area and Oakville are sitting longer.
“All of our data has been showing us people want to be close to downtown. You consider you’re going to pay a minimum of $5 million to be in York Mills and then it takes you an hour to get into the city for a game or a dinner or a show. That’s a turnoff for a lot of people,” he said.
The most expensive home on the Toronto market is a $32-million Bridle Path mansion, said Alexander. The most expensive home to sell so far this year was a $13.2 million property in Forest Hill.
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There’s a particularly high demand for luxury condos and townhomes as baby boomers and empty nesters look for downsizing properties, says Re/Max. At the time of the release there were about 118 condos and town houses listed at over $2 million inside the City of Toronto with an average price of $3.5 million.
“Inventory issues have been a major obstacle in recent months, with demand outpacing supply thorughout the downtown core, placing upward pressure on prices and, in some instance, creating bidding wars,” said the release.
Alexander said he expects the luxury market to continue to make slow, steady gains that are closer to 2016 rather than 2017 sales levels — “a good, healthy place to be.”