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Toronto's Tony Real Estate Hot
May 2009 strongest month on record for luxury home sales, says RE/MAX
Sales of luxury properties in the Greater Toronto Area posted their strongest performance on record in May 2009, according to RE/MAX Ontario-Atlantic Canada. Two hundred and seventy-three high-end homes changed hands in May 2009, up 6% from 258 reported during the same period one year earlier, and the highest number of sales over $1 million in a one-month period in the history of the Toronto Real Estate Board.
The previous record was set in May of 2007 at 266 sales. "Confidence is slowly returning to the marketplace," says Michael Polzler, Executive Vice President, Regional Director, RE/MAX Ontario-Atlantic Canada. "Traditional market indicators are in place - the stock market has made tremendous gains in recent months, crude values have risen significantly, and the Canadian dollar has gained almost 10 points in the past month. Combine these influences with pent-up demand and growing economic stability and you have the ingredients for solid sales in the top-end of the market."
Further evidence of a rebound is the recent sale of a Bridle Path home priced at over $13 million, the first sale over the $10 million price point in more than a year. The 18,000 sq. ft. gated estate, situated on more than two acres, was listed by Barry Cohen, Broker, RE/MAX Realtron, and featured a spectacular backyard with a negative edge waterfall pool, fountains, hot tub, and tennis court.
Demand for homes priced in excess of $1 million has increased steadily since the beginning of the year, says Polzler, mimicking the overall real estate market. Seven hundred homes have changed hands year-to-date, compared to 944 in January to May of 2008. Given current momentum, however, it's likely that activity will continue at a healthy pace for the remainder of the year - with sales at year-end at least on par or ahead of 2008 levels.
June 12, 2009 in Toronto Real Estate Trends | Permalink
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Comments
I agree with the above comment but people don't realize that affordability is actually going in reverse since in a shrinking economy average incomes are falling (though prices in TO, really are not). Historically prices peak in July on annual basis. This mini housing boom doesn't really make any sense in this current economic environment when jobs are cut left and right, but I guess the low interest rates are fueling the boom. We shall see. US had a mini boom before the bottom fell out and wants to know in more details please go through the link...http://wwww.freedevelopments.com
Posted by: Toronto Condos | Jun 16, 2009 4:00:07 AM
I have to chuckle when the guy says "crude values have risen significantly". So that is a good thing going forward. I got one word for you this is inflation going forward and decline of purchasing power of average person on other goods and services.
Posted by: Investor | Jun 14, 2009 11:29:34 PM
Historically prices peak in July on annual basis. This mini housing boom doesn't really make any sense in this current economic environment when jobs are cut left and right, but I guess the low interest rates are fueling the boom. We shall see. US had a mini boom before the bottom fell out.
Who in their right mind would want to take on more debt when things are very uncertain? The answer is behavioral finance. I guess debt in sexy these days.
Posted by: Investor | Jun 14, 2009 11:27:00 PM
I agree with the above comment but people don't realize that affordablity is actually going in reverse since in a shrinking economy average incomes are falling (though prices in TO, really are not). I still wonder how sustainable it is to have the average home price at over 5 times the average family income (and this number would be much higher if you took out one-bedroom condos which aren't appropriatwe for any family). I fear this might be a blip brought on but historically low interest rates. Incomes will need to start rising fast if these price levels are to be sustained over the longer term.
Posted by: Tom B. | Jun 12, 2009 5:26:00 PM
I can’t say I’m terribly surprised. Historically, those who can afford luxury homes can afford them even when the economy is struggling. I do keep hoping that this is a harbinger of good news for the industry.
Posted by: real estate agent in Toronto | Jun 12, 2009 2:43:12 PM
