It is no surprise that the Toronto housing market is booming and is now forecasted to take the top spot in one particular area: luxury condo prices.
Overall in Canada, luxury home prices are on the rise in the Greater Toronto Area, Montreal, and Ottawa, after posting gains during the twelve-month period ending January 31, 2020.
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Canada’s five largest markets are the GTA, Greater Montreal Area (GMA), Greater Vancouver, Ottawa, and Greater Calgary.
Toronto prices forecasted to continue climbing
The GTA saw a significant price gain of 7% for luxury condos over the 12 month period.
During this period, the median price of a luxury house in the GTA rose 1.2% to $3,629,916 while the median price of a luxury condominium rose 7% to $2,402,650.
“Luxury condominiums in Toronto saw significant price appreciation as the region’s international reputation continues to grow,” said Kevin Somers, Chief Operating Officer of Royal LePage.
Over the next year, luxury houses are expected to increase by 2.5% to $3,721,000 while luxury condominiums are forecast to increase 6.0% to $2,547,000.
Toronto’s high demand for condominiums comes from a range of buyers. Boomers and young executives looking for low maintenance, luxury property are competing against investors and foreign buyers who are also seeking a low maintenance property to use as a secondary residence, according to Steven Green, a sales representative at Royal LePage.
But Toronto also has limited housing availability in high demand areas of the city.
“Some of the city’s most desirable pockets have a very low inventory of listings, which is unfortunate for sellers who want to move up in the same neighbourhood,” Green said.
Montreal still takes the number one spot for now
While Toronto’s luxury home market is experiencing steady growth, Montreal’s detached luxury home market “continue to show significant upward price momentum,” Somers said.
Right now, the Greater Montreal Area (GMA) boasts the highest price increase of 8.5% to $1,853,513 for luxury houses. The median price of a luxury apartment-style condo rose 8.3% to $1,409,262 over the last 12 months.
During the next twelve months, the median price of a luxury house is forecast to increase 5.5% to $1,955,000 while the median price of a luxury condominium is forecast to rise 5.0% to $1,480,000.
However, like Toronto, Montreal has limited housing availability in high demand areas with the main reason being the lack of confidence among potential move-up buyers that they will find a better property if they sell their current one.
“Luxury sales in 2019 and heading into 2020 have been very brisk,” Marie-Yvonne Paint, of Royal LePage Heritage said. “Buyer demand for luxury houses continues to grow but supply is not keeping pace.”