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Booming Homes Sales worth over $1M in Canada's big cities

 

Homes worth over $1 million have been selling at an increased rate in a year-over-year report by Sotheby’s. Growth in Vancouver (25%) and Toronto (38%) is expected to continue into 2015, whereas growth in Calgary (16%) and Montreal (21%) is expected to be balanced. Sotheby’s is closely watching Calgary and how the severe drop in oil prices will impact its luxury homes market. Calgary may experience a slow down in purchases, as seen in the tail end of 2014, because buyers are being more cautious. Despite a recent CHMC report stating low foreign ownership numbers in Vancouver and Toronto, Sotheby’s said that half of homes worth $5 million or more are owned by foreign investors. This discrepancy is because foreign purchases are transacted through Canadian subcompanies, however Sotheby’s is unable to give hard numbers. CMHC data wouldn’t capture these corporate transactions, whereas Sotheby’s familiarity in the luxury homes market places it in a better position to gauge the level of foreign ownership. Some critic mentioned concern about the stability of this market, in case these foreign owners suddenly selloff their high-value properties, causing a crash in Canada’s real estate market. However, Sotheby’s says that historically low mortgage rates and high levels of immigration continue to make Canadian real estate attractive overseas.

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