The Greater Toronto luxury real estate market is expected to rebound this fall, according to data compiled by Sotheby’s, one of the top luxury real estate market brokerages in the country.
“Toronto’s top-tier real estate market is positioned for a turnaround this fall.”
According to Sotheby’s 2018 Fall Market Forecast, released on Wednesday, sales of real estate over $1 million and luxury homes over $4 million rose significantly in a year-over-year basis by 19% and 34%, respectively.
“Toronto’s top-tier real estate market is positioned for a turnaround this fall. Since the introduction of Ontario’s Fair Housing Plan in April 2017, the market has maintained ground in spite of rapid policy changes, as well as rising mortgage rates and tighter lending guidelines,” says Brad Henderson, the President and CEO of Sotheby’s International Realty Canada.
Not so bright for Greater Vancouver
On the other hand, luxury real estate activity in Vancouver is expected to decelerate even further. Vancouver’s cooling real estate market is now well documented and economists agree that it was primarily caused by to recent increases of interest rates as well as the effect of recent housing taxes and policies. In the case of luxury real estate, Sotheby’s attributes the decrease in sales activity to a slowdown in buyer engagement. The luxury brokerage now expects an increase in listings inventory, which will further suppress pricing demands by sellers.
“With new listings inventory being added to the market and cooling demand. Vancouver’s top-tier market will entrench in favour of buyers to the end of the year.”
Though the luxury market remained strong in the first half of 2018, Vancouver had a 24% decrease in sales of single family homes over $1 million, and a 33% decrease in detached homes over $4 million this last summer. The report goes on to say that the first two weeks of September were significantly sluggish, in a month in which sales usually pick up.
“With new listings inventory being added to the market and cooling demand. Vancouver’s top-tier market will entrench in favour of buyers to the end of the year,” concludes the report.