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Renewed confidence in Canada’s post-pandemic return and economic recovery bolstered gains across the country’s major metropolitan luxury real estate markets through the first half of 2021. As the Bank of Canada reported first-quarter GDP growth at a “robust” 5.6%, the Conference Board of Canada projected a 6.1% expansion of real GDP in 2021, with solid economic recovery expected across every province. Resulting confidence, housing demand and eroding luxury real estate inventory were captured in new data compiled by Sotheby’s International Realty Canada that reflect record-breaking levels of activity and prices across the country’s major luxury markets through the first half of the year.
“The pandemic era reinforced the importance of ‘home’ and ‘space’ to a degree that has never been experienced; we expect this to have a lasting impact across many facets of the Canadian luxury real estate market,” says Don Kottick, President and CEO of Sotheby’s International Realty Canada. “Perhaps most profoundly, there has been a major shift in the psychology of luxury real estate consumers and homeowners. The new reality is that as the perceived value of living space has increased, affluent buyers’ ‘willingness to pay’ for luxury real estate has increased exponentially. Affluent consumers are more prepared to invest in additional space and in next-level architecture and design, whether through upsizing, home renovations or home building. This is elevating the quality and pricing of housing in Canada’s most prestigious neighbourhoods, in many cases, permanently.”
According to Kottick, the impact of pandemic luxury market influences previously reported in Sotheby’s International Realty Canada’s 2021 Spring Outlook will continue to cascade across the country’s real estate market in the coming months. Strengthening confidence in a Canadian economic recovery, the anticipated reopening of provincial and national borders to travel and immigration, as well as the continued access to low-cost borrowing and stores of cash savings will empower multiple waves of local and international luxury real estate consumers into the latter half of 2021, driving luxury sales.
MARKET HIGHLIGHTS *
Calgary
Luxury real estate activity in Calgary renewed in the first half of 2021 as business, real estate industry and consumer sentiment took on a cautiously optimistic tone with gains in oil and gas prices, and broader vaccine coverage. The $1 million-plus residential real estate market transitioned to more balanced market conditions as sales rose 236% year-over-year from the levels seen in the first half of 2020, albeit unevenly across housing types. While activity recovered across the city’s single-family and attached home markets, with healthy 230% and 338% year-over-year sales gains respectively, condominium sales over $1 million continued to comprise a nominal percentage of the luxury market despite an uptick of 350% to nine units sold in the first half of 2021.
Greater Toronto Area (GTA)
Activity in the Greater Toronto Area (Durham, Halton, Peel, Toronto and York) luxury residential real estate market eclipsed the superlative performance of other Canadian markets in the first half of 2021, as sales over $4 million (condominiums, attached and single-family homes) soared 276% year-over-year. Of these,15 ultra-luxury properties sold over $10 million, an increase of 114%, from the first half of 2020. Significant gains were experienced across all luxury housing types, with sales over $4 million for condominiums, attached and single-family homes up 88%, 400% and 290% year-over-year, respectively. Overall, $1 million-plus residential sales surged 217% year-over-year in a market that heavily favoured sellers and fatigued buyers.
Vancouver
The tempo of Vancouver’s luxury market also accelerated to a frenetic pace in the first half of 2021, as residential sales over $4 million and $10 million surged 152% and 300% year-over-year, respectively. As in the case of Toronto and Montreal, the performance of the city’s luxury condominium market overcame its initial pandemic stall, with $4 million-plus sales regaining momentum over the spring to achieve a 138% year-over-year gain by the first half of 2021. Meanwhile, $4 million-plus single-family home and attached home sales climbed 152% and 300%, respectively. By mid-year, residential real estate sales over $1 million were up 107% from 2020 levels.
Montreal
Luxury real estate activity in Calgary renewed in the first half of 2021 as business, real estate industry and consumer sentiment took on a cautiously optimistic tone with gains in oil and gas prices, and broader vaccine coverage. The $1 million-plus residential real estate market transitioned to more balanced market conditions as sales rose 236% year-over-year from the levels seen in the first half of 2020, albeit unevenly across housing types. While activity recovered across the city’s single-family and attached home markets, with healthy 230% and 338% year-over-year sales gains respectively, condominium sales over $1 million continued to comprise a nominal percentage of the luxury market despite an uptick of 350% to nine units sold in the first half of 2021.
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