After last year’s frenzied performance in the top end of the market, sales of luxury homes in the Greater Toronto Area are moving at a pace more in line with healthy 2016 levels. Sixty-eight freehold properties have changed hands over $3 million so far this year. This falls short of record 2017 levels that saw 175 sales between January 1 and February 28, and 79 sales during the same period in 2016. Thirteen sales have occurred in excess of $5 million in 2018, down from 26 during the same period one year ago.
While sales have dropped, there has been a slight upswing reported in average price over the $3-million price point, with values rising to $4,201,873 in the first two months of 2018, compared to $4,100,420 one year ago.
Despite the slight softening in the market, demand for luxury property remains consistent in the Greater Toronto Area, with a shortage of fresh product over $3 million holding back sales to some extent. Most of the luxury homes currently listed for sale are dated, having lingered on the market, with some originally introduced in 2017. Newer product tends to move at an accelerated rate, especially in Toronto proper, with most realizing a list-to-sale-price ratio of 98 to 100 per cent. Multiple offers continue to occur on upscale properties, particularly in the coveted 416 area code.
Of the 68 luxury sales in 2018, 45 occurred in Toronto proper (66 per cent). The rate is up over last year’s 60.5 per cent. In the 905, York Region has seen the greatest reduction in luxury sales activity, with eight transactions occurring in 2018 compared to 41 in 2017. Affluent neighbourhoods in the core continue to see steady activity, with Rosedale (C09) and the Kingsway (W08) both bucking the downward trend. Ten sales occurred in Rosedale so far this year, up from nine one year ago, while the Kingsway has jumped to four sales, up from one sale a year ago. Greater inventory levels in these pockets have astute purchasers actively searching for product in the city’s most prestigious areas. That said, freehold sales over $3 million represented just 0.07 per cent of total residential sales in the GTA in 2018, falling from 1.3 per cent during the same period in 2017. Luxury sales represented 0.06 per cent of total residential sales during the same period in 2016.
While high-end market activity appears to be heating up, with a conditional double-digit sale in the Bridle Path area expected to firm up in the coming weeks, comparisons of luxury product will continue to fall short during the traditional spring market. As the uncertainty in the marketplace dissipates and more quality inventory comes up stream, there should be an increase in sales with levels more on par with 2017 from June throughout the remainder of the year. By year end, luxury sales over the $3-million price point are expected to be comparable to 2016 levels, with approximately 800 homes changing hands in the Greater Toronto Area.