Since the introduction of Ontario’s Fair Housing Plan in April 2017, the market has stood its ground despite these policy changes, while battling rising mortgage rates and tighter lending guidelines. “Toronto’s top-tier real estate market is positioned for a turnaround this Fall”, says Brad Henderson, President & CEO, Sotheby’s International Realty Canada.
It’s a combination of renewed consumer confidence and the former apprehension that followed the introduction of the Ontario Fair Housing Plan, which has slowly dissipated. Pent up consumer demand paired with a renewed top-tier listing activity is expected to propel gains in sales, velocity and pricing across all housing segments to the end of 2018.
Strengthening consumer engagement and robust economic fundamentals in the nation’s largest housing market are projected to drive Canadian top-tier real estate performance this fall, as sales over $1 million rebound in Toronto. Residential activity for the GTA in price categories over $1 million and $4 million is also gaining traction, as summer sales rose 19% and 34% year-over-year, respectively.
Contrary to seasonal tendencies for real estate activity to slow over the summer months, top-tier activity strengthened this July and August. This reflects a shift towards a transformed dynamic between sellers and buyers, or investors; a transition that carries into an active fall market.
The luxury condominium market saw the most distinct gains in sales activity over the summer months, forecasting a strong fall for condos. Sales over $1 million increased 28% and 21% in the GTA and City of Toronto, respectively, to 199 and 170 condos sold. Changing demographics and evolving consumer preferences favouring urban lifestyles contribute to, and continue to motivate, the migration of consumers and investors into condos in the city’s core.
Single-family home sales over $1 million rose 20% year-over-year in the GTA, and 12% in the City of Toronto, to 1,916 and 580 units, respectively. However, a shortage of available listings on the market, between the $1 million to $2.5 million segment, restricted summer activity. Conversely, luxury home sales over $4 million experienced strong year-over-year gains, with sales up 35% to 42 units in the GTA, and 50% to 30 units in the City of Toronto. Furthermore, attached home sales over $1 million experienced 6% and 8% year-over-year gains in the GTA and City of Toronto, respectively, to 181 units and 147 units sold.
According to Sotheby’s International Realty Canada, “healthy levels of fresh inventory have been introduced into the market and buyer activity is brisk”. With Ontario’s economy projected to advance by a moderate 2.2% according to the Conference Board of Canada, consumer confidence and strong economic fundamentals are expected to anchor top-tier market health to the end of the year.