Many new words and phrases became part of our global lexicon in 2020 and 2021: ‘lockdown’, ‘novel coronavirus’, ‘double vaccinated’, ‘viral load’: This was terminology that we all had to get acquainted with very quickly, whether we liked it or not. When we went into lockdown in March of 2020, the number of listings on the market in the GTA took a nosedive as we all did what we were required to do in Ontario to stop the transmission of this new virus. Multiple lockdowns have necessitated that the real estate market in the GTA has had to continue with some personal protective equipment changes and consistent guidelines to keep buyers, sellers, and their representatives safe. Since March of 2020, property showings have been limited to 30 minutes for buyers and their realtors only. No additional family members have been permitted to attend showings nor children as it is unrealistic to expect little ones to not touch any surfaces during a property showing.
Since April of 2020, average sale prices have been steadily rising in Durham Region to a current record high $1.01M. There are still simply not enough properties for sale for the buyers wanting/needing them and Covid has just exacerbated this fact: now swaths of Toronto buyers are able to move out farther as they work remotely. Working from home has simply become more normalized, less taboo, and considered to be equally If not MORE efficient than commuting to one’s place of business 5 days a week. We simply need an increased supply of homes to sell, given the fact that buyers wanting properties in Durham Region has only increased as the pandemic has progressed.
Our current real estate market in Durham Region is different than at any other time: There are only 20 detached properties in all of Durham that are currently in ‘sold conditional’ status. This means that these sales are conditional until buyers fulfill their conditions to firm up their purchases to ‘Sold Firm’ so to speak. Historically, there used to be up around 170 ‘sold conditionals’ at any given time in our region. What this means, is that the number of sellers that have had to accept offers with risky conditions in them has plummeted. Since the beginning of the pandemic, this extreme sellers’ market has meant that sellers have had the luxury of minimal to zero risk selling their homes in a market where there might be multiple offers on a home at one time. Essentially, because supply has been low and demand has been high, sellers have had the leverage to pick and choose what offers/buyers could bring the highest sale price with the least amount of risk (fewest number of conditions). Buyers have had to take on considerable risk making purchases in the last 18 months often in the absence of having inspection, insurance, and financing conditions in their offers.
The luxury market has shown remarkable growth in both average sale prices and the number of units (homes) sold since 2018. Average sale price increases in luxury homes have easily surpassed that seen in the larger detached market (that includes all price points).
The first graph below compares the percentage increase in sale prices (appreciation) from 2018 to 2019, 2020, and 2021 for Luxury Homes vs All detached homes sold in Durham Region.
This second graph below demonstrates the percentage increase in the number of units sold for Luxury Homes vs All detached homes compared to 2018.
While is it still critical to price position luxury homes correctly to get my clients the highest sale price achievable in the market(s) they sell in, these noteworthy increases in both the average sale prices and the number of luxury properties sold in Durham Region has risen dramatically compared to the other detached properties in the region at all different price points.
If you are on the precipice of potentially selling your luxury property and are questioning whether now is a good time to do so, I would be happy to have a conversation with you to explain why there has never been a better time to get the equity out of your luxury property for what comes next in you and your family’s life journey.