The global pandemic had a dramatic impact on every segment of the Canadian real estate market. Condo sales and prices took a temporary dip while detached home sales and prices skyrocketed, as people increasingly recognized the value in bigger homes with yards. Add to this low borrowing costs and record-high savings rates, which made moving up in the market a possibility for many Canadians. As a result, sales of luxury real estate have surged.
To get a handle on what’s been happening in the luxury market, we chatted with RE/MAX Noblecorp’s Steven Liambas, who listed and recently sold this 8+1 bedroom, 10 bathroom home north of the Greater Toronto Area, with an asking price of $19.9 million (pictured above).
Active Luxury Real Estate Market in the Greater Toronto Area – and Beyond
In its 2021 GTA luxury property report by RE/MAX, RE/MAX analyzed sales and prices in 60 Toronto Regional Real Estate Board (TRREB) districts. The report found that luxury home sales over $3 million were up 55.7% in 2020 compared to 2019, topping peak 2017 levels and setting a new record for luxury real estate. Sales of homes priced over $5 million were 44% ahead of 2019 levels. Interestingly, the bulk of activity was seen in areas outside of Toronto proper, with Halton reporting a 188.8% increase in sales over $3 million, followed by Peel at +112% and York at +85.%. Moving even further outside of the GTA to the Township of Oro-Medonte (the location of Liambas’ listing) the local luxury market is not unlike most others in Canada – experiencing seller’s market conditions characterized by a shortage of listings.
“The seller’s market, lack of inventory and low interest rates are all favourable for the luxury market,” says Liambas. “Additionally, many people are veering away from building custom due to the lack of construction materials, price surges and uncertainty. They are looking for a move-in ready home.”
Liambas describes inventory in this Lake Simcoe locale as low and limited. “It’s a very exclusive pocket called ‘Millionaires Row.’ Not many homes come up on the market here,” he says. And when they do, “luxury tends to get scooped up more quickly lately. People are looking to move to more secluded areas due to COVID-19.”
Perhaps the luxury sector represents yet another triumph in the Canadian real estate market throughout the pandemic. In the early days of COVID-19, rumours of a potential housing market crash quickly made way for a market that, by many accounts, became a measure of success for the Canadian economy. What some industry observers expected to be a cold year for real estate ended up being one of the hottest in history, with high demand and not enough homes on the market for everyone who wanted one. These strong seller’s market conditions continued through 2021, with housing supply shortages being a factor in 27 out of 30 major markets analyzed in the RE/MAX Canada 2021 Fall Housing Market Report.
The Secret to Selling Luxury (Hint: this could take all night)
Despite strong seller’s market conditions, even in the luxury sector, a successful sale at the high-end of the price spectrum requires the right approach and a healthy dose of patience – regardless of COVID-19.
Liambas’ strategy was “To get the most exposure possible, locally and internationally.” The property was listed in more than 100 countries. Marketing efforts included New York Times, Wall Street Journal, Juwai (Chinese network), Dupont Registry (magazine cover, blog and feature), Narcity, Globe and Mail, and more. “I actually slept over at the property to shoot sunrise and sunset photos with the media company,” he says. While this particular property didn’t require any renovations or staging, that’s something Liambas would typically focus on as well as part of the listing preparation process.
“I spent over $80,000 in marketing this property, including videos, drones, twilight, 3D tour, newspaper, digital agencies, international websites, billboards and so much more,” he says.
Liambas’ efforts and investments have literally paid off, with a “sold” sign and a big win in a challenging market.