Overseas investors are set to boost sales of prime property in Canada this autumn.
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Buyers from China, Russia, the Middle East, India and the United States are expect to be among those looking for high-end homes in major cities during the fall, says leading agent Sotheby’s International Realty Canada.
Over the year to June, sales of luxury homes worth at least CAN$1million have risen, according to the newly-published Top Tier Report.
Single family homes in the first half of 2013 compared with the same time last year, worth more than CAN$1million have risen by 10% in Calgary, 6% in Montreal, 5% in Toronto and are down 2% in Vancouver. Most property sold was worth between CAN$1-4million.
Sales of townhouses worth more than CAN$1million were up 73% year-on-year in Calgary and 21% in Toronto, but were down 8% in both Vancouver and Montreal.
But condo year-on-year condo sales were down in all areas, falling 37% in Calgary, 20% in Vancouver and 19% in Toronto and Montreal.
Sotheby’s President and Chief Executive Ross McCredie says, “In examining the performance of the high-end market, we feel confident that Canada’s largest urban centres remain in exceptional positions heading into fall, with healthy market fundamentals from coast to coast.”
Despite the annual fall in condo sales, many overseas buyers are still actively looking to buy.
Elli Davis, a Sales Representative from Royal LePage, Toronto, says many foreigners buy condos for their children to live in while they attend school in Canada.
“I’m seeing a lot of foreign names on showings of all of my listings. More foreign names than not.”
Canadian buyers have lagged a little behind international demand, says the bi-annual report that is claimed to only Canadian study that compares data for residential properties with values over CAN$1million.
“The performance of Canada’s high-end residential real estate market in the first half of 2013 reflected a year of recalibration and overall strength.
“While international demand for luxury real estate in the major urban centres of Vancouver, Calgary, Toronto and Montreal had been consistently strong leading into 2013, Canadian buyers had taken time to adjust to the precautionary lending controls implemented by the Bank of Canada in July 2012.
“By June 30, 2013, sales data for the first half of 2013 reflected positive momentum in key markets compared to the last half of 2012, with variations between condominiums, attached homes and single family homes, as well as between price segments above the $1million mark.
Mr McCredie says investors luxury home are unlikely to be put off by short-term market fluctuations. “They’re not first-time homebuyers. They’ve seen cycles before. Most of our clients remember what it was like in the early 80s and the early 90s, when you had major corrections, so they’re not going into these markets blindly.”
In Vancouver, sales are now picking up, the report claims. The city saw 1,239 sales of homes over CAN$1 million in the first six months of the year. “Buyers are beginning to gain more confidence when making big purchase decisions and those who initially put their decision to buy on hold are now coming back on the market.”
Calgary saw 388 sales over $1 million from 1 January to 30 June. “Calgary’s high-end residential real estate market continues to display strong market fundamentals, setting records in the first half of 2013 while experiencing both a steady rise in sales volume for homes over $1million and a strong decline in days on market for key segments compared to 2012.”
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