Sotheby's International Realty Canada's latest report forecasts strengthing demand for residential real estate over $1 million in Toronto and Vancouver into the fall, including building momentum in luxury sales over $4 million, reinforcing both cities' positions as international market leaders in top-tier real estate.
The 2015 Fall Forecast analyzes Canada's largest metropolitan real estate markets and examination of key macro-economic indicators.
Sales of units over $1 million (condominiums, attached and detached single family) increased 56%, 48%, and 20% year-over-year in the Greater Toronto Area (GTA), Vancouver, and Montreal markets respectively, while sales volume decreased 36% in Calgary. At the same time, luxury real estate sales in the $2-4 million and the $4 million-plus ranges surged 52% and 71% in Vancouver, and 46% and 72% in the GTA.
- The Bank of Canada's September 2015 decision to hold the key overnight interest rate at 0.5% will continue to have a positive impact on real estate sales over $1 million
- In most metropolitan markets, the contraction in the Canadian economy during the first part of the year, and speculation that growth may weaken has not affected consumer confidence in the $1 million-plus real estate market.
- The demand for single-family homes over $1 million in the GTA and Vancouver is expected to remain high, outstripping available inventory.
- There's limited supply in the single family home market. As a result, demand for condominiums and attached homes over $1 milliom n is expected to remain strong in the Greater Toronto Area and Vancouver.
- International demand for top-tier real estate in Canada's major cities is expected to remain high as volatility in global stock markets and a faltering Chinese economy results in a continued influx of buyers, particularily from mainland China.
- The upcoming federal election is not expected to impact the $1 million-plus real estate market heading into fall 2015.
Vancouver Market Highlights:
- Limited inventory, strong consumer demand, low interest rates and international buyers will continue to drive favourable seller conditions, multiple offers and sales above list prices in the fall.
- Vancouver's $1 million-plus real estate market is expected to continue to trend upward in fall 2015.
- Detached single family home market is expected to lead gains in sales volume and pricing, particularily in the $2-4 million and $4 million-plus luxury segments, while the performance of the attached home and condo markets will remain strong.
- Limited supply in traditional luxury neighbourhoods will propel buyers into neighbourhoods east and south.