2021 was a record year for ultra-rich luxury homebuyers

There has been a transformational shift in where people choose to live and how Canadians perceive the value of their homes.

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Luxury real estate sales were stronger than ever in 2021. More homes sold for over $1 million than ever before and ultra-rich buyers flocked to premier properties here in Quebec.

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In December alone, there were two record sales of more than $18 million in Montreal: first the private sale of an $18.5 million property in Westmount, and then an $18.75 million waterfront mansion in Senneville.

Luxury condo sales also reached new heights in 2021, accounting for one in four homes listed in the Centris system that sold for more than $1 million. The most expensive condo sold through MLS last year was the $11 million “Rockstar” penthouse at The Ritz-Carlton.

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According to a report on luxury property sales released this week by Sotheby’s International Realty, sales of homes over $4 million in the Montreal area are up 171% from 2020 levels, while sales volume of over $1 million increased 137%. Single-family home sales over $1 million were up 130 percent year over year, while townhome and condo sales over $1 million were up 130 percent and 165 percent, respectively. Luxury goods sales also increased in other major Canadian cities, including Toronto and Vancouver.

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Who is spending this kind of money in Montreal? Most of the time, ultra-luxury property buyers here are…wait for it…well-heeled Montrealers.

The Westmount estate was sold to a Montreal-based family of online fashion entrepreneurs. The Senneville mansion? Also to a local person. The Rockstar condo was an exception: It was sold to an American buyer who didn’t set foot in the place before making an offer.

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While foreign buyers have been a favorite scapegoat for those looking for someone to blame for rapidly rising prices, pandemic travel restrictions have all but wiped out global demand. While there were some brave buyers willing to pay millions of dollars for a property they had never seen in person, local demand was a much bigger influence, according to the report.

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Sotheby’s International Realty Canada President and CEO Don Kottick says the main reason for the sharp increase in real estate prices in Montreal is that the supply of homes for sale is not enough to meet buyer demand.

“It’s about inventory,” Kottick said. “We have the demand, there is a lot of demand and there is going to be continued demand. Until we address the inventory issues, we’ll find ourselves in this. That’s probably why we’re going to see some price appreciation in 2022, because the demand is definitely there and the inventory isn’t.”

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Low interest rates, record levels of cash savings and anxiety about the performance of the stock market also contributed to increasing real estate investment, he said.

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The pressures of the COVID-19 pandemic have resulted in a transformational change in where people choose to live and how Canadians perceive the value of their homes. With travel and other splurges off the table, those with money have found new ways to spend it: at home.

Those of means who couldn’t (or didn’t want to) move refurbished their spaces or added bedrooms, offices, pools, or other amenities. This has also contributed to rising prices as older homes are upgraded to meet current needs, Kottick said.

That is not to say that international investment is not a factor. High-profile (and expensive) condominium projects like Four Seasons Residences will continue to attract the interest of luxury buyers, both international folks who want a pied-à-terre in Montreal and local jet-setters who want pampering. world class. here at home. For these discerning buyers, the amenities, culture, and overall experience of a place are far more important than price.

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“Montreal is starting to build that product, and as a result, they are starting to attract those buyers,” he said.

According to another report on luxury real estate published Wednesday by Engel & Völkers, demand for high-end properties has been so strong, and new listings so rare, that premium home inventory in the best neighborhoods is becoming scarce. The real estate brokerage predicts that the downtown condo market will therefore be the 2022 frontrunner.

Engel & Völkers anticipates that the seller’s market will continue this year due to consistently low inventory and prices will continue to rise as a result.

“While Montreal was known for its affordability, this is rapidly changing,” the report states.

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Reference-montrealgazette.com

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