A report released by one of Canada’s top real estate agencies on Thursday found that demand for Canadian luxury properties shifted into high gear across the country last year and it isn’t just in the biggest cities.
According to the study by
RE/MAX Canada (NYSE: RMAX, Forum), both domestic and non-resident consumption of tangible assets such as residential real estate reached new levels from coast to coast in 2021, pushing sales to double and triple year-over-year.
Perhaps most interesting, is that the study reported that luxury home-buying activity is spilling into smaller centres. The pandemic accelerated the trend, but “bigger bang for the buck” is forecast to continue to draw purchasers from larger centres, particularly in Ontario.
In
a media release, RE/MAX Canada’s President, Christopher Alexander said that the currency of home ownership had clearly taken on a new dimension in 2021.
“Canadians are moving to secure their future. The pandemic fuelled a run on real estate that has encompassed every segment of the market, and the value of housing has increased exponentially as a result–not only as a form of shelter but a desirable asset class that provides an attractive return on investment.”
(Image via Re/Max Canada. Click to enlarge)
The report examined trends and developments in sales of freehold and condominium properties priced over $3 million in Metro Vancouver and the Greater Toronto Area and tracked sales over $1 million in 17 additional Canadian housing markets. It also found that 18 of the 19 markets analyzed recorded percentage increases in the double and triple digits.
The greatest appreciation occurred in smaller urban markets such as Barrie, London, Kitchener-Waterloo, and Hamilton, where sales of homes priced over $1 million have climbed 517%, 255%, 208%, and 199.5% respectively.
Canada’s largest markets for luxury product – the Greater Toronto Area and Metro Vancouver – experienced increases of 112.8% and 75.8% respectively for homes over the $3-million price point, while transactions of homes priced over $10 million rose a substantial 156% and 167% \respectively.
As excessive as these numbers are, Alexander adds that they merely “scratch the surface”. While these are luxury prices, they no doubt reflect the state of home ownership in Canada at all levels. What do you see for the future of real estate in our country? A solid investment, unattainable goal, or bubble ready to burst? Let us know your thoughts in the comments below.