Still, the sector remains more resilient than the conventional market, executive says
The luxury housing market saw a downturn in September despite remaining more resilient than the conventional market, according to Sotheby’s International Realty Canada chief executive Don Kottick.
Speaking to the Financial Post, Kottick said Sotheby’s findings showed that the luxury real estate market had a slow pace at the start of the year but eventually saw momentum pick up, particularly in July and August. However, the market slightly tapered in September.
A market that is resilient, but not bulletproof
Kottick said that in the third quarter, the market was driven by single family homes while the luxury condo market declined slightly. Although this decline was felt by major markets in the country, Calgary’s luxury housing market continued to be active.
Its luxury condominium market had reached more than $1 million in sales with a 106% year-over-year increase in September, being the only market to have seen such changes in the month.
In Vancouver, the market had a 96% increase in July and August but had gone down by 29% in September. Montreal had a 31% increase in July and August but only saw a 4% increase in September.
Kottick noted that some investors for luxury condominiums had come back to the market, but buyers were now more discerning than they had been before. With the intention of looking for units where they wanted to live in, buyers were now more eager to get a home that was worth their money and were willing to negotiate for it. If a unit did not fit their preferences, they were much more willing to walk away as they wanted homes that can immediately fit their lifestyles.
While the resilience of the luxury housing market was much more prominent than the conventional market and were not typically affected by the dynamics of the market, Kottick noted that it can still be impacted by factors such as geopolitical activities and the rising cost of living.
Those factors mean it’s difficult to predict what’s in store for the market in the coming months, according to Kottick.