by Nutan Brown
on Tuesday, March 10th, 2020 at 12:12pm.
The increase in Toronto home prices is not just fixed to the residential market. According to the latest report from Royal LePage, luxury home prices are on the rise as well.
A significant factor for the increase in luxury home prices, which Royal LePage defines as those that sell for at least $1.32M, was limited inventory. Another key contributor is a lack of confidence among potential move-up buyers that they will find a suitable listing if they sell their current homes.
“Luxury buyers face the same low inventory scenario that challenges the overall residential market,” said Steven Green, sales representative, Royal LePage Partners Realty. “Some of the city’s most desirable pockets have a very low inventory of listings, which is unfortunate for sellers who want to move up in the same neighbourhood.”
As a result, the median price of a luxury home in the GTA rose 1.2% to $3,629,916 over the past twelve months, while the median price of a luxury condominium rose 7% to $2,402,650.
* Forecast data collected includes resale and new build transactions. Price data is provided by RPS Real Property Solutions.
Luxury condominiums appear to be in high demand as well, as boomers and young executives are competing against investors and foreign buyers who are seeking a low maintenance property to use as a secondary residence. If this trend continues, over the next year luxury houses are expected to increase by 2.5% to $3,721,000 while luxury condominiums are forecast to increase 6% to $2,547,000.