Despite enduring a prolonged period of stay-at-home lockdowns and restrictions since April due to an aggressive third wave of COVID-19, the performance of Canada’s largest luxury real estate market eclipsed that of other major metropolitan areas in the first half of 2021.
Luxury residential real estate sales in the Greater Toronto Area (Durham, Halton, Peel, Toronto and York) rebounded in the first half of the year, shattering sales records and reinforcing the region’s position as the national leader in luxury real estate sales. As the pandemic drove significant changes in consumer housing needs, intense local demand readily absorbed supply. Low interest rates and broad confidence in the long-term fundamentals of Canada’s dominant economic region also contributed to a market characterized by rapid sales, bidding wars, and untethered price gains across every high-end residential housing type. Sotheby’s International Realty Canada experts noted that across the GTA, rising luxury real estate prices have been fuelled by affluent consumers’ increasing “willingness-to-pay” over the course of the pandemic. This sentiment has risen steeply with the general desire for more and higher quality living space, and with consumers’ rising expectations for an elevated calibre of design, finishes and amenities that are redefining luxury homes across the region.
Overall GTA luxury residential sales over $4 million (condominiums, attached and single family homes) rose 276% year-over-year to 414 properties sold in the first half of 2021. Of these, 15 ultra-luxury properties sold over $10 million compared to seven properties sold above this price in the first half of 2020. $2–4 million and $1–2 million sales experienced 236% and 213% gains to 3,900 and 25,080 properties sold respectively. Sales over $1 million were up 217% overall in the first half of the year at 29,394 transactions, with a significant 67% selling above list price.
In the City of Toronto, residential real estate sales over $4 million (condominiums, attached and single family homes) increased 188% from 2020 levels to 233 properties sold in the first half of 2021. Of these, nine ultra-luxury homes sold over $10 million, compared to six homes sold in the first half of 2020. Sales between $2–4 million increased 140% to 1,707 properties sold, while sales between $1–2 million rose 162% year-over-year to 7,061 properties sold. Overall, , residential sales over $1 million in the City of Toronto experienced a 159% year-over-year increase to 9,001 properties sold in the first half of 2021 with 64% of these transactions surpassing the list price.
Buoyed by consumer demand for more space given changing work and lifestyle needs with the pandemic, the GTA luxury single family home market soared in the first half of 2021. Luxury sales over $4 million were up 290% in year-over-year gains in the GTA, and 199% in the City of Toronto, to 394 and 215 homes sold. 14 single family homes sold over $10 million in the GTA during this time compared to seven sold in the same period in 2021, while $10 million-plus single family home sales in the City of Toronto increased 33% to eight homes sold compared to six sold in the first half of 2020. In the GTA, $2–4 million and $1–2 million sales rose 247% and 202% to 3,538 and 19,220 homes sold respectively. Meanwhile, in the City of Toronto, sales between $2–4 million and $1–2 million increased 139% and 192% to 1,381 and 3,975 homes sold. By mid-year, GTA and City of Toronto single family home sales over $1 million were up 209% and 177%, to 23,152 and 5,571 homes sold. 67% of $1 million plus GTA single family home sales and 66% of those in the City of Toronto took place above list price.
As single family home price escalation continued to sideline buyers into higher density housing options, luxury attached home sales and prices climbed sharply, even as a dearth of inventory constrained activity. Five attached homes sold over $4 million in the first half of 2021 in the GTA, all in the City of Toronto, compared to one home sold in the first half of 2020. Sales of luxury attached homes between $2–4 million increased 222% year-over-year in the GTA, and 209% in the City of Toronto to 232 and 216 homes sold. $1–2 million attached home sales increased 342% to 4,395 units sold in the GTA during this time, with City of Toronto-specific sales rising 150% to 1,895 units sold. Overall GTA and City of Toronto attached home sales over $1 million surged 334% and 155%, to 4,632 and 2,116 homes sold in the first half of the year. 77% of $1 million-plus GTA and City of Toronto attached homes sold above list price.
Although consumer demand for luxury single family homes overshadowed that for condominiums in the latter months of 2020, luxury condominium market activity, velocity and confidence accelerated through the first half of 2021. As demand for urban living reignited with broader vaccine availability, and as the lack of inventory in the single family and attached home markets channelled homebuyers into higher density housing, bidding wars and price gains once again became the market norm. However, the impact of the pandemic on luxury real estate consumer preferences has been evident in both the new construction and resale markets. Sotheby’s International Realty Canada experts have noted that local demand for low- and mid-rise boutique luxury condominium residences has flourished, coloured by consumer preferences for lower density condominium living and larger floor plates, even as Toronto’s luxury high-rise listings have attracted an increasing volume of global enquiries, with increased sales transactions anticipated as travel restrictions continue to lift.
Overall luxury condominium sales over $4 million were up 88% year-over-year in the GTA from eight sold in the first half of 2020, to 15 units sold in the first half of 2021. One unit sold over $10 million compared to zero units the year prior. Luxury condominium sales between $2–4 million were up 91% to 130 units sold, while GTA condominium sales between $1–2 million were up 126% year-over-year to 1,465 units sold. Overall GTA condo sales over $1 million were up 122% in the first half of 2021 to 1,610 units sold, with 39% of these selling above list price.
In the City of Toronto, luxury condominium sales over $4 million increased 63% from eight sold in the first half of 2020 to 13 units sold in the first half of this year, with one unit selling above $10 million compared to zero in the first half of 2020. Sales between $2–4 million climbed 80% year-over-year to 110 units sold from January to June, while sales between $1–2 million surged a significant 109% year-over-year in the first half of 2021 to 1,191 units sold. Overall condo sales over $1 million in the City of Toronto were up 105% to 1,314 units sold in the first half of 2021, with 39% of these selling above the list price.
Despite booming demand for conventional and luxury real estate, land supply remains tight in the City of Toronto and across the GTA, resulting in the rapid absorption of available resale, new construction and pre-construction inventory. With Ontario’s economic growth forecast to advance by 5.6% in 2021 according to the Conference Board of Canada, and with the GTA poised as Canada’s epicentre for population and economic growth as pandemic travel and immigration restrictions ease, the region’s optimistic economic outlook is set to elevate the demand for conventional and top-tier real estate into the third quarter of 2021.