Despite a new stress test and rising interest rates, luxury condo prices in Canada’s major cities are expected to climb next year, except in Calgary.
According to Royal LePage’s 2018 Spring Luxury Report, out of all markets surveyed — Greater Toronto Area (GTA), Greater Montreal Area, Greater Vancouver, Calgary and Montreal — Calgary will be the only city to see declines in luxury condo prices in 2019.
Royal LePage defines all luxury homes as properties worth three times the average price in the local market.
“Calgary is the only city surveyed that is expected to see the median price of a luxury condominium dip in spring 2019 when compared to 2018, decreasing 4 per cent year-over-year,” reads the report, published Thursday.
During the first four months of 2018, the median price of a luxury condo in the city fell 6.1 per cent to $926,620 compared to Q1 2017.
Looking ahead to the first quarter of 2019, luxury condo prices are forecast to hit $889,568, a four per cent decrease from Q1 2018.
Although the city’s luxury condos are poised to see a drop in value next year, Calgary’s top-tier detached prices are expected to rise, as the city’s economy continues its slow recovery.
“Calgary’s luxury home market has long adjusted to the downturn in oil prices, and resultant executive level job loss,” says John Hripko, Royal LePage Benchmark associate broker, in a statement.
“Now that the city’s real estate has found its price floor, we expect to see modest gains as our diversified economy continues to improve,” he adds.
It’s a different story for Calgary’s detached market though. In the first quarter of 2019, the median price of a detached home is forecast to increase two per cent year-over-year to $2,029,988 from $1,990,184 in Q1 2018.