Toronto was ranked the world’s hottest luxury real estate market in a new report that shows US$100 million is the new benchmark for prime properties.
Demand for mega-mansions and penthouses has accelerated as wealthy buyers seek havens for their cash and search for alternative investments such as art and collectible real estate, according to the report Thursday by Christie’s International Real Estate, owned by auction house Christie’s.
While Toronto ranked 10th on the report’s luxury index overall it was first on the luxury thermometer as the only top city to see a 37 per cent increase in luxury home sales in 2014 compared to just four per cent the previous year.
The report said that low supply of homes in Toronto has pushed prices to $1–$2 million for "relatively average homes" in the city and up to $2–$4 million for larger homes or those in the most desirable neighbourhoods.
Toronto also had the fastest sales pace, with prime properties finding a buyer within an average of 31 days after listing.
The ultra-luxury housing market is scaling new heights as a record number of properties around the world command prices topping US$100 million
Five homes sold for more than US$100 million last year, with at least 20 more on the market with nine-figure asking prices, the brokerage said.
“You’re looking at a universe of over 1,800 billionaires who are starting to become members of this club of collectors of the most unique and incredible real estate in the world,” Dan Conn, chief executive officer of Christie’s International Real Estate, said in a telephone interview. “It’s something they’ll hold onto for a lifetime, the same way they’ll hold onto a Picasso or a Warhol or any number of the great pieces of art we’ve sold over the years.”
Sales are likely to increase this year with more newly built properties and off-market homes trading for at least US$100 million, Conn said. Demand is growing among affluent Americans and Europeans; billionaires from unstable economies, such as Russia and Middle Eastern countries; and buyers from mainland China, who were barred from investing overseas before 2012 and since have snapped up houses in cities including Hong Kong, Los Angeles, New York and London, he said.