Aug 27 | Posted by Barry Cohen

The world economy may be in turmoil and the global markets fluctuating but the housing market in the GTA is strong and strengthening every month.  In fact, demand for luxury properties over 4 million dollars was up by 72 percent in the first half of this year compared to the same period last year.

In Canada’s two largest cities, namely Toronto and Vancouver, the demand for homes in the $4 million plus price range is high and sales are predicted to spike further by the end of the year.  With available inventory remaining low, there is an escalating sense of urgency among buyers who fear that if they don’t get into the market now, they may be locked out forever, and as a result they are willing to pay whatever it takes to get what they want.  Despite the doom and gloom in some other markets, there doesn’t seem to be any sign of a market “correction” any time soon at least in these two cities.

Sales of houses and condos in the GTA over $1 million dollars were up 56 percent in the first half of this year compared with 2014 statistics, which rocketed our city to the top spot as Canada’s priciest city, surpassing Vancouver where sales in that price point were up 48 percent. 

There are a number of factors behind these record-breaking numbers:

  • high demand and low inventory
  • record low interest rates
  • the weakened Canadian dollar making our markets very attractive to foreign investors
  • increased immigration

We can’t forget that a million dollars doesn’t by what it used to and prices on everything have gone up exponentially.  Right now in the GTA most average detached homes have been catapulted into the million-dollar price range. The most recent national sales statistics reveal that on average a 1500 square foot detached home in Toronto will set you back about $2 million, and a 1400 square foot condo now sells for $1.5 million in both Toronto and Vancouver.  

The demand for Top Tier luxury properties is very strong in the GTA and bidding wars and bully bids are not uncommon.  Multiple bids on high-end real estate are almost the norm.  These facts tell the whole story:

  • 47 percent of properties in the $1 - $2 million range sold over list price
  • 35 percent of properties in the $2 - $4 million range sold over list price
  • 18 percent of properties in the $4 million plus range sold for over list price

A large proportion of high-end sales can be attributed to Baby Boomers who are unaffected by the markets or interest rates as the majority purchase these homes with cash, and have decided that they want to spend their last 20 years or so living in style.

If you are considering buying or selling a luxury property in the GTA I am a luxury real estate specialist and I would be happy to use my experience and expertise in this niche market to assist you with your purchase or sale.