“Understanding real estate cycles is important as they can provide reliable information about how and when to buy and sell, particularly when a market is transitioning.”
What is the current state of luxury home market in Toronto?
Despite a slowdown in sales, the demand for desirable properties remains in more affordable price points remain stable.
Buyers are seeking homes that offer unique experiences, access to adventure, and are filled with high-end amenities. As the cost of building has increased substantially (from $200 per square foot to renovate a condo to about $500 per square foot to renovate a home, and around $800 to build a house), they are willing to pay a premium for newly renovated and upgraded properties.
In the luxury detached homes market, we are seeing a seller’s market up to the $5.1 million price point, with an increased inventory by 27%, or 3.4-month inventory available.
✦The average price for a detached home has decreased by 3% to $3.12 million year-over-year
✦Sales of detached homes have decreased by 59% with an average of 11 days on the market.
In the luxury attached homes market, we are also seeing a seller’s market up to the $1.5 million price point, with an increased inventory by 68%, or 4-month inventory available.
✦The average price for an attached home has increased by 2% to $1.1 million year-over-year
✦Sales of attached homes have decreased by 68% year-over-year with an average of 16 days on the market.
In contrast, experts predict that fewer homes will be sold in 2023 for the first time in ten years, reasoning that it is still due to the low supply of new and existing inventory rather than lack of demand, higher prices, or the cost of purchasing a home.