Real estate company Royal LePage released on Thursday its latest report on the Canada luxury real estate market.
Here’s the full report:
PRESS RELEASE
TORONTO, Sept. 19, 2024 /CNW/ – Luxury real estate properties in Canada’s largest markets continue to demonstrate price stability, with less pronounced peaks and valleys compared to the typical fluctuations seen in the mainstream market. According to the 2024 Royal LePage® Carriage Trade® Luxury Market Report1 released today, sales of luxury homes were up in the first eight months of the year, compared to the same period in 2023, in almost all major cities in Canada – with the exception of the two most expensive markets, Vancouver and Toronto, as well as Halifax. Meanwhile, prices posted modest gains in some regions and slight declines in others.
Phil Soper
“Homes typically trade hands at the high end of the market at a slower pace than we see in the industry overall, as the funnel of potential purchasers narrows as the price of properties climbs. This affords luxury buyers the luxury of acting more deliberately, taking their time in a quest to find exactly the right home,” said Phil Soper, president and chief executive officer, Royal LePage. “While market conditions can vary from one city or province to the next, the dynamics at play in luxury real estate markets from coast to coast remain consistent: buyers in this segment know what they want and they are willing to wait for it.”
While transaction volumes in the high-end property segment are lower relative to the mainstream residential market, luxury markets in the Prairie provinces recorded some of the largest gains in sales activity year over year in the first eight months of 2024, led by Winnipeg, with Edmonton and Calgary close behind. This is reflective of the strong state of their overall markets, especially Alberta, which has proven more resilient than most of the country over the past year. This is due to its continued strong demand from out-of-province buyers. Outside of the Prairies, Quebec City has also recorded strong luxury sales growth this year.
Looking ahead, experts in all major cities across Canada expect to see brisk activity in the fall market.
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1 The 2024 Royal LePage® Carriage Trade® Luxury Market Report provides data and insights on luxury properties, across all residential housing types, in ten of Canada’s largest real estate markets. Data was compiled by Royal LePage® using local brokerage and board statistics for the periods of January 1, 2023 to August 31, 2023, and January 1, 2024 to August 31, 2024. Commentary on local market trends and data are provided by Royal LePage luxury real estate experts, based on their opinions and market knowledge. Lower price thresholds: Vancouver ($5,500,000), Calgary ($1,750,000), Edmonton ($1,250,000), Regina ($750,000), Winnipeg ($1,000,000), Toronto ($4,750,000), Ottawa ($2,000,000), Montreal ($2,500,000), Quebec City ($1,000,000), Halifax ($1,500,000) |
Consumer confidence driving luxury market activity
According to Royal LePage regional luxury market experts, buyers in this segment are discerning. In some regions, the high cost of construction is driving demand in the resale segment, where buyers are seeking fully-renovated, turn-key properties. In other areas, buyers prefer to build the custom home of their dreams, despite high cost construction costs and extended timelines.
“Luxury buyers typically have the means to be picky. Their home buying decisions are shaped by more than the desire to live in a particular neighbourhood or to enjoy very specific high-end features and amenities. Often, their decision whether to buy or not is driven by their confidence in the health of the overall economy and the direction they see housing prices headed. Our research shows those in the higher end of the housing market have a very positive outlook on the long-term stability and appreciation potential of Canada’s housing stock,” noted Soper.
“Many buyers in the luxury market segment do not require high-leverage mortgages, where the amount borrowed relative to the value of the underlying property is large. In fact, it is common to see expensive homes purchased with very substantial down payments, or even fully in cash. Thus, luxury homebuyers as a rule are not as heavily impacted by high interest rates as the average consumer. It is primarily the positive impact on macroeconomic factors that will encourage new buyers in the luxury segment.”
Impact of foreign buyer ban on luxury property sales
In January 2023, the federal government implemented a two-year restriction on the purchase of residential real estate by non-Canadians, in an effort to free up much-needed supply for local buyers. While the so-called foreign buyer ban, which has since been extended until January 1st, 2027,2 contributed to reduced demand in some of the country’s most affluent markets for a brief period, it has not had a material impact on prices or available inventory.
“Foreign investors in residential real estate tend to focus on the luxury market. It is typically wealthy people who consider owning a property in a foreign country. Two years in, and the prohibition on foreign buyers has had virtually no impact on housing prices in Canada, as we expected. Prolonging the international buyer ban will not make housing more accessible to Canadians.
“Inventory shortages in Canada’s housing market are not limited to entry-level asset classes. With a vast majority of buyer interest coming from Canadians, be it in the luxury market or elsewhere, upward pressure on prices will continue as long as supply fails to meet the demand for homes,” Soper concluded.
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2 Federal government extends foreign buyer ban to 2027, February 15, 2024 |
2024 Royal LePage Carriage Trade Luxury Market Report – Data Chart:
rlp.ca/2024-Luxury-Market-Report-Chart
REGIONAL SUMMARIES
TORONTO
In the first eight months of 2024, the median price of a luxury property in the city of Toronto increased 3.9 per cent year over year to $5,820,000. During the same period, sales activity decreased 5.0 per cent. The entry-level price of a luxury property in Toronto is $4,750,000.
“Toronto’s luxury market had a soft start to the year as the introduction of the updated municipal land transfer tax came into effect on January 1st. The amended tax saw graduated increases on properties valued over $3,000,000, starting at 3.5 per cent and moving upwards. This led to a slower-than-normal spring market, which caused our inventory of available homes for sale to increase,” said Gillian Oxley, sales representative, Royal LePage Real Estate Services Oxley Real Estate. “However, the interesting element of the spring market was the many sellers who did not pull their listings off of the MLS when activity softened. Instead, many sellers chose to keep their homes listed, pushing up the average days on market.”
Properties that have sold over the minimum luxury price threshold in Toronto this year have an average of 4.2 bedrooms, 5.7 bathrooms, and 2,369 square feet of living space.
“Given current market conditions, it’s no surprise that many buyers are looking for ‘deals’ and we have seen clients getting into the luxury market at a lower threshold,” said Oxley. “Currently, buyers are prepared to be more patient when looking for the right home. That said, space and location continue to be the ultimate luxury. Homes that offer walkability to transit, the city’s high-end restaurants, parks and ravines, remain among the most sought-after listings.”
Oxley expects Toronto’s luxury market will see stronger levels of activity in the fall and improved market conditions in the spring, as lowered interest rates and economic stability lend to higher consumer confidence.
2024 Royal LePage Carriage Trade Luxury Market Report – Data Chart:
rlp.ca/2024-Luxury-Market-Report-Chart
MONTREAL
In the first eight months of 2024, the median price of a luxury property in the city of Montreal decreased 2.8 per cent year over year to $3,150,000. During the same period, sales activity increased 8.3 per cent. The entry-level price of a luxury property in Montreal is $2,500,000.
“Sales activity in Montreal’s luxury property market has experienced an upturn in the past year, despite both buyers and sellers taking a wait-and-see approach to the economy and housing market. As interest rates decline steadily, high-end purchasers feel more reassured about making important financial decisions, such as buying a home,” said Marie-Yvonne Paint, certified residential and commercial real estate broker, Royal LePage Heritage. “In light of rising construction material costs and skilled-labour shortages, buyers are seeking turn-key properties with limited renovations required, and are waiting for the right product to be listed. Sellers, on the other hand, are equally patient, holding firm on their asking price, resulting in higher luxury housing inventory compared to pandemic levels.”
Properties that have sold over the minimum luxury price threshold in Montreal this year have an average of 3.7 bedrooms and 3.1 bathrooms.
Paint also noted that a number of sellers are listing their homes to test the market’s waters and gauge buyer interest, which inflates inventory levels and extends the average days on market in the high-end property category.
“Given that the luxury property segment remains rather small compared to the overall real estate market, the number of comparable homes is equally low and can make setting the right listing price a challenge for sellers,” she explained. “Relying on the niche expertise and knowledge of a real estate professional will allow the property to have a successful sale, with limited days on market and with the most favourable outcome for both parties.”
Paint expects Montreal’s luxury market to post steady growth during the fall and into the spring market, with stabilizing inflation and falling interest rates fueling overall optimism among buyers.
2024 Royal LePage Carriage Trade Luxury Market Report – Data Chart:
rlp.ca/2024-Luxury-Market-Report-Chart
VANCOUVER
In the first eight months of 2024, the median price of a luxury property in the city of Vancouver decreased a modest 1.8 per cent year over year to $6,975,000. During the same period, sales activity declined 38.8 per cent. The entry-level price of a luxury property in Vancouver is $5,500,000.
“In Vancouver’s luxury segment, it seems everyone is trying to time the bottom of the market. As such, we’ve seen a slowdown in activity of late. After all, buyers love to buy when others are buying,” said Jesse Dean Cook, sales representative, Royal LePage Sussex. “Some buyers are expecting prices to drop and are holding out for a deal. But, given the current shortage of luxury housing inventory, price discounts are not materializing.”
Properties that have sold over the minimum luxury price threshold in Vancouver this year have an average of 5.2 bedrooms and 6.0 bathrooms.
“A pullback in Vancouver’s luxury market began about eight years ago, and activity levels have never fully rebounded. The implementation of the 2023 foreign buyer ban, which has limited residential real estate purchases by non-Canadians, has reduced demand, although it has not had a material impact on prices,” noted Cook. “Lower interest rates have done little to motivate activity in this market, which is dominated by buyers who do not typically require financing. Instead, interest rates are used as a temperature check for the overall health of the national and global economies, which have been unsteady these past few years.”
Cook expects moderate activity levels through the fall, despite the likelihood of additional interest rate cuts.
2024 Royal LePage Carriage Trade Luxury Market Report – Data Chart:
rlp.ca/2024-Luxury-Market-Report-Chart
OTTAWA
In the first eight months of 2024, the median price of a luxury property in the city of Ottawa increased 2.0 per cent year over year to $2,442,500. During the same period, sales activity increased 13.0 per cent. The entry-level price of a luxury property in Ottawa is $2,000,000.
“Last year was sluggish for the Ottawa luxury market as clients took a wait-and-see approach. We turned a corner this March, resulting in a strong spring and many properties trading hands in the first half of 2024. As a result, we have seen a modest uptick in luxury home prices,” said Charles Sezlik, sales representative, Royal LePage Team Realty. “Supply has been on the rise thanks to the completion of more luxury builds, in addition to a renewed sense of confidence among sellers. Similarly, buyer sentiment remains positive, though a drop in interest rates has little to do with this optimistic outlook – most buyers shopping over the $2,000,000 mark are less affected by the cost of borrowing.”
Properties that have sold over the minimum luxury price threshold in Ottawa this year have an average of 4.6 bedrooms and 4.4 bathrooms.
“As a result of the foreign buyer ban, purchasing a home in Ottawa has been tricky for international clients. However, luxury homes continue to receive interest from the city’s robust roster of entrepreneurs, tech workers and top-level federal employees and officials,” said Sezlik. “Of particular interest is Ottawa’s series of modern, block-style homes. Builders are continuing to churn out new supply, despite the increased cost of materials and labour.”
Sezlik expects that the luxury market will see consistent activity throughout the fall, followed by a seasonally-typical upswing in the spring.
2024 Royal LePage Carriage Trade Luxury Market Report – Data Chart:
rlp.ca/2024-Luxury-Market-Report-Chart
QUEBEC CITY
In the first eight months of 2024, the median price of a luxury property in Quebec City decreased 7.2 per cent year over year to $1,200,000. During the same period, sales activity increased 30.4 per cent. The entry-level price of a luxury property in Quebec City is $1,000,000.
“In Quebec City, the luxury property segment has followed a different trajectory from the mainstream residential real estate market this year, observing downward pressure on prices and an increase in the number of transactions compared to 2023,” said Louis Belzile, residential and commercial real estate broker at Royal LePage Blanc & Noir. “While the mainstream market continues to see multiple offers and overbidding, Quebec City’s luxury segment is experiencing buyer-friendly conditions with increased inventory and reduced prices, giving purchasers an advantage. The exception is sought-after turn-key properties, whose listing prices are well in line with actual market value, and tend to receive competitive offers.”
Belzile adds that young professionals and families looking for a more spacious residence are a growing clientele for luxury properties in the market’s entry-level price segment.
Properties that have sold over the minimum luxury price threshold in Quebec City this year have an average of 3.5 bedrooms and 2.4 bathrooms.
Though luxury homebuyers are less sensitive to interest rate fluctuations, it is rare for buyers to make a million-dollar home purchase without financing, according to Belzile.
“Luxury buyers in Quebec City are looking for homes that go beyond square footage. They’re seeking properties with soul, unique character and tasteful renovations. In today’s market, high-quality, custom-built and turn-key homes are selling at lightning speed,” emphasizes Belzile. “While traditional neighbourhoods like Sillery and Sainte-Foy remain popular, emerging locations like Lac-Beauport are increasingly coveted for their proximity to nature. They are a major attraction for those seeking a more serene lifestyle within a reasonable distance of downtown.”
Belzile expects that luxury buyer demand will continue into the fall and be sustained for most of 2025, spurred by the continued easing of interest rates, which should drive prices up moderately in the months ahead.
2024 Royal LePage Carriage Trade Luxury Market Report – Data Chart:
rlp.ca/2024-Luxury-Market-Report-Chart
CALGARY
In the first eight months of 2024, the median price of a luxury property in Calgary remained virtually flat, dipping just 0.3 per cent year over year to $2,143,000. During the same period, sales activity increased 30.9 per cent. The entry-level price of a luxury property in Calgary is $1,750,000.
“Throughout the pandemic, many of our luxury clients felt a sense of uncertainty and chose to hold off on their purchase plans, creating a slowdown in activity. We started to see a return to the market in 2023, with further pick up this spring,” said John Hripko, sales representative, Royal LePage Benchmark. “Some buyers are taking their time, possibly looking for a deal. When a luxury property sits on the market, some people expect that the seller will get desperate and drop the price eventually, but this is rare. Most sellers in this segment view this transaction as more of a business decision.”
Properties that have sold over the minimum luxury price threshold in Calgary this year have an average of 4.3 bedrooms, 4.5 bathrooms, and 3,261 square feet of living space.
“Though the luxury segment represents a small portion of the overall market, demand in this area is certainly fast-growing,” said Hripko. “Calgary continues to see a number of people relocating from other major Canadian cities, knowing they can get a luxury product for a better price here; one that has a larger lot yet is still in close proximity to the downtown core. Neighbourhoods like Mount Royal and Elbow Park are of particular interest.”
Hripko expects moderate activity in the luxury market this fall, as buyers continue to take their time to source the ideal property.
2024 Royal LePage Carriage Trade Luxury Market Report – Data Chart:
rlp.ca/2024-Luxury-Market-Report-Chart
EDMONTON
In the first eight months of 2024, the median price of a luxury property in Edmonton remained virtually flat, rising 0.9 per cent year over year to $1,589,900. During the same period, sales activity increased 39.7 per cent. The entry-level price of a luxury property in Edmonton is $1,250,000.
“Luxury home sales in Edmonton have been on an upswing this past year, particularly at the entry-level end of the price scale. Recently, listings have begun to dwindle slightly, as is typical for this time of year as school goes back in session, which has created a positive shift for active sellers who are seeing increased demand and more showings for the fewer number of available properties. This is likely to put upward pressure on prices in the coming months as motivated buyers look to make a purchase before colder weather sets in,” said Ed Lastiwka, associate broker, Royal LePage Noralta Real Estate. “Buyers who are eager to transact will need to act with decisiveness given this increasingly competitive landscape.”
Properties that have sold over the minimum luxury price threshold in Edmonton this year have an average of 4.3 bedrooms and 3.8 bathrooms.
“There appears to be two primary luxury buyer types shopping in Edmonton these days – those who are interested in remodelling older, custom-built homes, and those who prefer to completely rebuild from the ground up in more central locations closer to downtown, such as the city’s River Valley neighbourhood,” said Lastiwka. “Another subset of luxury buyers will look to the outer-city’s newer communities where the land value tends to be less, where they can find a suitable property or build the house of their dreams from scratch.”
Lastiwka added that while interest rate fluctuations generally have less of an impact on the luxury segment, those at the entry level of the high-end market likely do require financing. He expects activity will remain strong, especially as interest rates continue to fall.
2024 Royal LePage Carriage Trade Luxury Market Report – Data Chart:
rlp.ca/2024-Luxury-Market-Report-Chart
HALIFAX
In the first eight months of 2024, the median price of a luxury property in Halifax increased 8.6 per cent year over year to $1,929,500, the highest price appreciation recorded in Canada’s major cities. During the same period, sales activity decreased 16.7 per cent. The entry-level price of a luxury property in Halifax is $1,500,000.
“In this post-COVID environment, we have seen luxury clients who did not want to get caught up in the buying and selling frenzy of 2021 make a return, as interest rates have started to drop and the state of the economy becomes less uncertain. We have seen steady price growth in this seller’s market as available supply remains out of step with demand,” said David Dunn, sales representative, Royal LePage Atlantic. “While the spring market was a bit quieter than usual, mimicking trends in the mainstream market, we have already started to feel a buzz of activity building heading into the fall.”
Properties that have sold over the minimum luxury price threshold in Halifax this year have an average of 3.5 bedrooms, 2.9 bathrooms, and 2,405 square feet of living space.
“The continuous development of new high-end neighbourhoods is helping to bring more supply to the market. We have seen demand from growing families as well as from buyers moving back to Atlantic Canada who are seeking luxury accommodations, particularly those from more expensive communities who have cashed in in order to move into an upgraded space,” said Dunn. “For most luxury buyers, access to a good school district is an important selling feature of a community. Properties on the Halifax Peninsula, as well as waterfront or mature, treed lots, tend to catch the attention of affluent purchasers.”
Dunn expects a strong fall market, making up for the slower start to the year. The anticipation of cabin fever typically drives activity as East Coast buyers look to secure a property before they hunker down for the winter.
2024 Royal LePage Carriage Trade Luxury Market Report – Data Chart:
rlp.ca/2024-Luxury-Market-Report-Chart
WINNIPEG
In the first eight months of 2024, the median price of a luxury property in Winnipeg increased 4.9 per cent year over year to $1,206,000. During the same period, sales activity increased 61.9 per cent, the highest increase in transactions recorded in Canada’s major cities. The entry-level price of a luxury property in Winnipeg is $1,000,000.
“The luxury slice of the real estate pie is not large in Winnipeg. But, this part of the market has remained remarkably active, with no significant dip in activity in recent years. Buyers and sellers alike are confident in the enduring value of luxury homes, which have proven to be quite stable,” said Chris Pennycook, sales representative, Royal LePage Dynamic Real Estate. “With a steady stream of buyers, many of whom are professionals, business owners and high-income earners looking to upgrade, sellers can list with confidence. And, buyers here view luxury real estate as a solid long-term investment.”
Properties that have sold over the minimum luxury price threshold in Winnipeg this year have an average of 4.2 bedrooms, 3.1 bathrooms, and 2,892 square feet of living space.
“Demand for luxury real estate in Winnipeg’s high-end communities has been largely undeterred by rising interest rates, save for a short-lived period of stalled activity in the first half of 2022. While properties may not sell as quickly as those on the mainstream market, prices are far less likely to fluctuate.”
Pennycook expects the city’s luxury real estate market to close out the year on a high, with new listings coming online and strong demand persisting into the new year.
2024 Royal LePage Carriage Trade Luxury Market Report – Data Chart:
rlp.ca/2024-Luxury-Market-Report-Chart
REGINA
In the first eight months of 2024, the median price of a luxury property in Regina decreased 3.8 per cent year over year to $843,300. During the same period, sales activity increased 14.6 per cent. The entry-level price of a luxury property in Regina is $750,000.
“Regina’s high-end real estate market has maintained a healthy level of activity this year, despite broader economic fluctuations. Over the last three months, luxury properties have been selling briskly, with average days on market sitting under 40 days. This robust performance reflects a market that was not significantly impacted by the pandemic or interest rate shifts,”said Shaheen Zareh, sales representative, Royal LePage Regina Realty.
Properties that have sold over the minimum luxury price threshold in Regina this year have an average of 4.0 bedrooms, 3.6 bathrooms, and 2,223 square feet of living space.
“This year, we’ve observed a consistent trend: the entire market, including luxury, is undersupplied, but demand remains strong. Many high-end buyers are opting for custom builds rather than resale homes. This is partially due to the limited pool of available properties over $1,000,000, as well as a strong desire to own a home that is uniquely reflective of their distinct design preferences.”
While the luxury segment accounts for only a small portion of the overall market, Zareh expects activity will continue to increase through the end of the year, as it is likely to do across all property segments.
2024 Royal LePage Carriage Trade Luxury Market Report – Data Chart:
rlp.ca/2024-Luxury-Market-Report-Chart
About the Report
The 2024 Royal LePage® Carriage Trade® Luxury Market Report provides data and insights on luxury properties, across all residential housing types, in ten of Canada’s largest real estate markets. Data was compiled by Royal LePage® using local brokerage and board statistics for the periods of January 1, 2023 to August 31, 2023, and January 1, 2024 to August 31, 2024. Commentary on local market trends and data are provided by Royal LePage luxury real estate experts, based on their opinions and market knowledge.
Lower price thresholds: Vancouver ($5,500,000), Calgary ($1,750,000), Edmonton ($1,250,000), Regina ($750,000), Winnipeg ($1,000,000), Toronto ($4,750,000), Ottawa ($2,000,000), Montreal ($2,500,000), Quebec City ($1,000,000), Halifax ($1,500,000)
About Royal LePage
Serving Canadians since 1913, Royal LePage® is the country’s leading provider of services to real estate brokerages, with a network of approximately 20,000 real estate professionals in over 670 locations nationwide. Royal LePage is the only Canadian real estate company to have its own charitable foundation, the Royal LePage® Shelter Foundation™, which has been dedicated to supporting women’s shelters and domestic violence prevention programs for 25 years. Royal LePage is a Bridgemarq Real Estate Services® Inc. company, a TSX-listed corporation trading under the symbolTSX:BRE. For more information, please visit www.royallepage.ca.
Mario Toneguzzi
Mario Toneguzzi is Managing Editor of Canada’s Podcast. He has more than 40 years of experience as a daily newspaper writer, columnist, and editor. He was named in 2021 as one of the Top 10 Business Journalists in the World by PR News – the only Canadian to make the list. He was also named by RETHINK to its global list of Top Retail Experts 2024.
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