WATCH: Canada’s housing market is defying prediction of a bubble and showing new signs of strength. Mike Drolet reports on which cities are the hottest and whether the surging prices are here to stay.
OTTAWA – Canada’s housing market may be cooling, but there’s no loss of appetite for high-end real estate, according to Sotheby’s.
The realtor says in a new report that sales of homes worth more than $1 million boomed in the first half of 2014, with all four key metropolitan areas covered – Vancouver, Calgary, Toronto and Montreal – recording double-digit gains.
Vancouver and Toronto continue to lead the way with sales of homes worth $1 million or more increasing 34 per cent compared with the first six months of 2013.
That was followed by Calgary with a 17 per cent increase and Montreal with an 11 per cent gain, even though Quebec’s largest city posted an overall decline in sales in 2013.
Sotheby’s says that given Canada’s strong economic fundamentals, improved consumer confidence and super-low lending rates, all markets are expected to gain momentum in the second half of the year.
Sotheby’s adds it also expects international demand in top-tier real estate to remain robust despite the removal of Canada’s immigrant investor class program.
The realtor says sales of high-end homes were strong in all segments, from single family to attached homes and condominiums in the first six moths of 2014.
Despite worries about a condo bubble in Toronto and Vancouver, it says there has been no sign of let-up so far this year, with sales increases of 53 and 37 per cent respectively.
Demand was so strong in Toronto that 36 per cent of condos listed at between $1 million and $2 million sold above the asking price; 41 per cent of those listed between $2 million and $4 million sold above asking and all of those listed above $4 million got more than asking.
In all, there were about 6,400 homes that sold above $1 million in the four cities in the first half of 2014, including about 275 that sold for more than $4 million.
The most expensive home cited in the Sotheby’s report was located in Vancouver and was listed at $15 million.
Overall home sales in Canada got off to a slow start to 2014, in part due to a harsh winter, but have picked up with the warmer weather and rose a strong 5.9 per cent in May on a month-over-month basis, according to the Canadian Real Estate Association.