Photo: Michael Gil/Flickr
Sales of homes over $3 million rocketed upward in the first nine months of the year in both the GTA and Vancouver, a new report from RE/MAX says. Released November 3rd, it shows that GTA home sales in that price range leaped 86 per cent year-over-year, while Vancouver sales increased 41 per cent.
According to RE/MAX, a number of factors are behind the huge increase in the GTA, though “overall price appreciation in the market” is key. Put simply, low inventory and high demand for single-family homes have made it so more homes on the market are over the $3-million mark. Higher home prices have also allowed current homeowners to build up enough equity to purchase a higher-end home.
“Demand for luxury homes remains very strong in the Greater Toronto Area, driven mainly by local move-up buyers, though foreign buyers continue to play a significant role as well,” said Pamela Alexander, CEO and regional owner, North America at RE/MAX INTEGRA.
Across the country in Vancouver, the story is a little different. While the city’s 41 per cent leap in sales of homes priced over $3 million is notable, the RE/MAX report shows that sales of all home types over $1 million increased by only 3 per cent year-over-year in the first nine months of 2016 — that’s compared to 69 per cent in the GTA. What’s more, sales of single-family homes over $1 million fell 7 per cent.
Explaining those low numbers, Elton Ash, regional executive vice president at RE/MAX of Western Canada, said that the slowdown has come in the last few months. “Part of this may be due to the tax on foreign buyers that was introduced in August, though there may be other factors at play as well, such as higher inventory lessening buyers’ sense of urgency,” he noted.
RE/MAX sees luxury home sales in the GTA and Vancouver following the same trends until the end of the year, but also recommends keeping an eye on neighboring markets. At least two cities near the GTA and Vancouver saw large increases in sales of homes over $1 million in the first nine months of the year — Victoria, BC saw an 82 per cent uptick while Oakville, ON saw a rise of 111 per cent.