Sotheby's predicts rise in Vancouver, Toronto luxury home sales
A real estate agent puts up a 'sold' sign in front of a house in Toronto on April 20, 2010. (Darren Calabrese / THE CANADIAN PRESS)
Alexandra Posadzki, The Canadian Press
Published Wednesday, September 16, 2015 4:30AM EDT
Last Updated Wednesday, September 16, 2015 8:43AM EDT
TORONTO - Sotheby's International Realty Canada says turbulence on the Chinese stock market could send buyers from mainland China flocking to Canadian luxury real estate this fall.
The realtor predicts that sales of homes worth over $1 million will rise in Toronto and Vancouver, while Montreal's luxury market should be balanced and Calgary's will slow due to the effects of declining crude prices.
Sotheby's says sales gains are expected to be highest in the over $4 million category in the Toronto and Vancouver areas this fall, although higher sales volumes are expected in the $1-million to $4-million range, as well.
The realtor lists increased demand from international investors alongside limited inventory, historically low interest rates and heightened consumer confidence as the factors expected to fuel sales growth in Canada's two hottest real estate markets.
In Calgary - where the luxury real estate market turned down in the first half of the year due to lower oil prices and a dip in consumer confidence - sales likely will continue to decline.
Sotheby's says performance in Calgary's high-end housing market, which saw several years of record-breaking sales, is tied "inextricably" to the state of the oil and gas industry which, in turn, has an affect on employment and migration.
Meanwhile, volatility on the global stock markets is expected to lead to an influx of international buyers looking to snatch up top-tier Canadian homes - particularly buyers from China, where the economy has shown signs that it is slowing.
"Canada in general is seen as an oasis of political and economic stability," says Elaine Hung, the company's vice-president of marketing.
And Hung says that holds true despite the fact that Canada's economy slipped into a recession in the first half of the year and concern that low oil prices will continue to wreak havoc on Western Canada in the months ahead.
"There's been a lot of concern about the Canadian economy and uncertainty about what's going to happen next, but certainly when it comes down to real estate, what we've seen - particularly in the major metropolitan markets of Vancouver and Toronto - is that people are very, very confident in the real estate market itself," she said.