Canada’s luxury real estate market reported a robust Q1-2022 thanks to rising consumer optimism and economic revitalization, trends that have supported soaring sales for high-end condos.
In its Top-Tier Real Estate: Spring 2022 State of Luxury Report, Sotheby’s International Realty Canada reported “top-tier sales,” for luxury homes across all major metropolitan areas, particularly for condos priced over $1 million. In markets such as Toronto and Vancouver, where single-family and attached home supply is dwindling, luxury condos are increasingly becoming the best or only options for buyers according to Don Kottick, president and CEO of Sotheby’s International Realty Canada.
“Across Canada’s major metropolitan areas, we have seen extraordinary sales activity and consumer demand in the luxury condominium market this year, leaving no doubt that consumer and investor confidence in the downtown and urban market has been fully restored,” said Kottick in the report.
“While there are lifestyle, family stage, financial planning and generational drivers behind the super-charged luxury condominium market, its strength also reflects the stark imbalance between strong demand and inventory challenges we are seeing across the real estate market overall,” he added.
Leading into the spring, Sotheby’s Canada said that the luxury market is “poised for robust performance.”
However, a lacklustre housing supply and government policy interventions on the demand side may create headwinds in the market.
Luxury Toronto condo sales over $1 million surge by triple digits
The demand for high-end condos in Canada’s two largest cities helped to drive a significant portion of sales during the previous business quarter.
Overall, Toronto homes worth $1 million and up reported a 11 per cent year-over-year jump in sales in Q1-2022. Sales for luxury condos, attached and single-family homes worth over $4 million increased 30 per cent yearly in Toronto between January 1st and March 31st. Seven sales over $10 million were made over the same time period, down slightly from nine properties in the same price range during Q1-2021.
Luxury condo sales priced $1 million or more surged 120 per cent annually, significantly higher compared to attached homes — up 79 per cent — and single-family properties over $1 million, which are down 10 per cent year-over-year.
For luxury condos priced at $4 million and up, sales lead the market with a 160 per cent annual gain. By comparison, single-family home sales in this price range increased 24 per cent yearly. Four attached homes sold over $4 million during Q1-2022, a notable increase from the same time last year when no properties in this price segment were bought.
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Like Toronto, Vancouver’s luxury condo segment helped to drive sales in the first quarter “as the city’s long-standing single-family and attached home supply deficit channeled prospective buyers into high-density housing,” according to Sotheby’s report.
Sales for all Vancouver condo, attached and single-family properties priced over $4 million dropped 14 per cent annually to 99 homes sold in Q1-2022. Three properties priced over $10 million sold during the same period, half as many that traded hands in Q1-2021. For all property types worth over $1 million, sales were down 10 per cent annually from 2021’s first quarter with 1,470 homes sold.
The number of $1 million-plus condos sold was nearly equal to single-family homes in Q1-2022, as sales rose 29 per cent yearly to 559 condo transactions. This accounted for 38 per cent of all real estate sales in that price bracket last quarter. By comparison, 599 single-family $1 million-plus homes were sold during the same period, as were 315 attached properties, down 28 per cent and 16 per cent year-over-year.
Sales for luxury Vancouver condos worth over $4 million increased eight per cent yearly in Q1-2022 as 14 units traded hands.
Demand for high-end condos rises in Montréal and Calgary
Compared to 2021’s record-breaking levels, Montréal’s luxury market started to normalize during the first months of 2022, but condo units still accounted for a significant portion of sales.
Sales for $4 million-plus properties were up 140 per cent in Q1-2022 compared to the same period last year, while transactions priced over $1 million reported more moderate annual growth of six per cent compared to Q1-2021. One in three $1 million-plus home sales were in the luxury condo segment. Transactions for Montréal condos worth $1 million and up increased 73 per cent yearly as single-family and attached home transactions fell 11 per cent and eight per cent year-over-year.
As consumer optimism and economic recovery improved in Calgary during Q1-2022, luxury home sales grew. Home transactions over $1 million rose 82 per cent year-over-year between Q1-2021 and Q1-2022. Calgary’s $1 million-plus single-family and attached home sales increased 71 per cent and 258 per cent annually, while condo transactions over $1 million jumped from two to seven properties year-to-year.
Two homes worth over $4 million were sold last quarter, up from zero sales in this price segment last year.
