August sales numbers proved Torontonians kept shopping for homes despite the city’s notoriously high price tags. Teranet’s latest report says prices continued the climb with Toronto seeing the highest month-over-month increase in the country. Toronto, along with Canada’s other big metros, is no stranger to big spending with Sotheby’s expecting a luxury home shopping spree in the fall. Want to ensure your lap dog lives in the, er, lap of luxury? Then spring for one of these absolutely extravagant dog houses.

The high-end real estate market in Canada’s four largest cities will gain momentum this fall with several regions becoming sellers’ markets before the end of the year, predicts Sotheby’s International Realty Canada.

In the first half of 2013 the luxury market gained traction over the last half of 2012, Sotheby’s says, with sales up 65 per cent in Vancouver, 67 per cent in Calgary, 61 per cent in Toronto and 29 per cent in Montreal in the single family home category. Luxury attached home sales in all four markets increased as the average numbers of days on market declined. Sales of condos over $1 million were also up in Vancouver, Calgary and Toronto.

The real estate sales and marketing company says the upswing in luxury sales will be fueled in part by demand from foreign investors.

“The influence of international buyers in the high end will continue to increase in Toronto, Montreal, Vancouver and Calgary,” Sotheby’s says, adding that “the strongest foreign buying influences include China, Russia, the Middle East, India and the United States.”

A luxury home in Canada’s major urban centres costs $2 million dollars on average, with regional variations of course. And speaking of regional variance, let’s take a look at the highlights from the report for each of Canada’s four largest cities, shall we?

Calgary

  • Strong employment and migration numbers reflecting the city’s continued economic health will drive demand — it is estimated that for every 300 square feet of new office space created, an additional person is added to downtown Calgary.
  • The high number of executive level jobs created will continue to fuel demand for top-tier real estate as newcomers take advantage of the city’s relatively affordable real estate market to “buy up.”

Vancouver

  • With 955 of the 1,239 homes sold over $1 million in the first half of the year being single-family homes, single-family home sales are expected to lead the high-end market.
  • Vancouver will continue to be supported by the influence of international buyers — according to Sotheby’s International Realty Canada’s Top Tier Trends study from April, approximately 40% luxury single family homebuyers were from outside of Canada, a trend that is anticipated into the fall.
  • As in previous years, China will remain the top market influencer, along with Iran and the United States.

Toronto

  • The tightening supply of top-tier real estate, a tight rental market, as well as stable Bank of Canada interest rates, will be three of the main drivers for a positive fall.
  • In spite of negative industry predictions regarding the high-end condo market earlier in 2013, the market segment show signs of strength leading into the fall, with the number of condo resales increasing in the conventional and high end market compared to earlier this year.

Montreal

  • Montreal has led and will continue to lead the country in luxury real estate sales to international buyers — 50% to 60% of high-end homes now sell to foreign buyers, and experts believe that numbers will increase with strengthening demand from Asia and the Middle East.
  • The international influence on the market for investment-friendly condos is also notable: foreign purchasers have been buying multiple units of 600 square foot condos in several new downtown developments, a recent and promising trend for the market.

The Teranet-National Bank Composite House Price Index rose to a new high in August according to fresh data released today by the organization.

The national composite index was up 2.3 per cent in August from a year earlier and 0.6 per cent from July, while indexes in eight of the 11 markets monitored rose, some of them very significantly.

Toronto led the pack with a relatively whopping 1.2 per cent month-over-month increase, the highest increase in the country. Canada’s largest city also saw a 3.8 per cent year-over-year increase, the third largest increase recorded in the monthly report.

Toronto was only bested by Calgary, which delivered an impressive 6.5 per cent year-over-year increase, and Hamilton, which logged a 5.5 per cent year-over-year increase.

The other markets that exceeded the cross-country average were Quebec City (+3.5 per cent), Edmonton (+2.6 per cent) and Winnipeg (+2.6 per cent). Markets that saw a month-over-month increase but lagged the national average were Montreal (+0.7 per cent) and Ottawa-Gatineau (+0.3 per cent).

The three markets saw their indexes decline in August were Victoria (-2.5 per cent), Vancouver (-0.1 per cent) and Halifax (-0.6 per cent). This was the 13th straight month that Vancouver saw a decline and the first time since September 1996 that Halifax witnessed a decline.

Here’s a chart that summarizes the markets tracked by the index:

teranet house price index

Here’s a quick word from Teranet on how the index works:

“The Teranet–National Bank House Price Index is estimated by tracking observed or registered home prices over time using data collected from public land registries. All dwellings that have been sold at least twice are considered in the calculation of the index.”

Canada cracks top five list for real estate investment optimism

By: Monika Warzecha August 30, 2013 Canada Despite the high growth potential of emerging markets, Canada is still considered one of the top countries for investment from global companies in the real estate, hospitality and construction (RHC) sectors. The country ranked 5th behind India, China, Qatar and Chile in a new report from Ernst & Young Global Limited, called Global Capital Confidence Barometer: Real Estate, Hospitality and Construction. RHC respondents were asked to pick 5 countries outside their local markets that their company would be most likely to invest in during the next twelve months. Krista Blaikie, the National Real Estate leader with the network of firms, explained Canada “continues to attract the attention of investors searching for a stable political and economic environment not found in the Eurozone.” The highest ranking for an EU country was Germany, which came in at 15. Those ready to invest in the year ahead are considering smaller deals, with 64 per cent of companies expecting the majority of deals to fall between $51 million and $500 million US. Altogether, industry members appear more optimistic about the state of the global economy according to the survey. Across all property types, global real estate transactions totalled $241 billion in the first quarter of 2013, up 23 per cent from last year. A year ago, 53 per cent of RHC respondents said the economy is either stable or improving. This year, 85 per cent said the same. EY global investment Photo:

 

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