The luxury market in the Greater Toronto Area was very active during the first seven months of the year. Sales of properties over $3 million increased 119 per cent year-over-year. The increase of sales at the top-end of the luxury market can be attributed to two factors.
One is overall price appreciation in both markets, driven by low
inventory and high demand for single-family homes that has led to
more homes meeting the higher dollar threshold. A second factor is
high demand for luxury homes from foreign buyers in both markets.
Two demographics make up the majority of buyers in Toronto’s
luxury market. One is families with older children and parents with
professional jobs who have built up enough equity in their previous
home to upgrade. The second are families from outside of Canada,
primarily China, with school-aged children. These buyers typically
choose four or five-bedroom homes and are strongly influenced by
proximity to good schools.
Average sales prices now exceed $600,000 for a detached home. Our year over year gain for 2015 is expected to be at or near 10%
Canada Mortgage and housing has introduced new rules for additional down payments requiring 10% down after the $500k threshold. I doubt these measures will have any effect to slow sales.
Rates continue sub inflation
Inventory Remains Low
Immigration for Jobs and Safe Haven Continues
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