The $1 million difference: once-luxury price tag isn’t yet the average

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A million dollars doesn’t buy luxury in Canada’s largest cities anymore.

Rather, a new report notes that $1 million is increasingly the average for homes in Toronto and Vancouver, and it could soon be in Calgary, too, given the resale real estate market’s current trajectory, note local realtors.

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“In the next three to five years, there is potential for that kind of increase with the economy staying strong, high migration and inventory remaining low,” says Doug Cabral, realtor with Royal LePage Benchmark. Royal LePage Canada released a study late last month on what $1 million purchases across Canada, finding Edmonton offers the biggest bang for buyers’ bucks.

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It had the largest square footage for a $1-million home with an average of 2,675 square feet, three bedrooms and three bathrooms.

In Calgary, $1 million purchases a home with about 2,179 sq. ft., and likely three bedrooms and three bathrooms. The report used data from December, revealing that in cities like Vancouver $1 million buys a home with 900 sq. ft., two bedrooms and likely two bathrooms. In Toronto, the sum afford a 1,218-sq.-ft. home with likely three bedrooms and two bathrooms.

That differential has prompted some people to move to Calgary, selling their homes in larger cities, and “coming here with big pockets,” finding their dollars buy them much more home, Cabral says.

The current benchmark price for a Calgary home — across all types — is about $572,500, up about 10 per cent year over year. For single-family detached homes, the benchmark is about $702,200, an increase of about 13 per cent, Calgary Real Estate Board statistics show.

The benchmark figure excludes the lowest and highest priced homes on the market to determine the typical price. While up more than 20 per cent since 2022 for single-family detached homes in Calgary, the benchmark for all housing types in the Greater Toronto Area, in contrast, was a little more than $1 million in January, according to Canadian Real Estate Association data. For a single-family detached home, the benchmark is more than $1.2 million, and CREA numbers further show that in Vancouver a benchmark priced single-family detached home costs more than $1.9 million.

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Although the recent Royal LePage study showcased Calgary’s relative affordability, it is catching up with larger markets.

“We’re starting to see that appreciation that we’ve seen in other cities,” says Mark Neustaedter, associate realtor with eXp Realty, noting many homes in sought-after communities are reaching $1 million or more.

“Mahogany, one of the most desirable, is a great example.” He adds homes there listed for $650,000 three years ago are more likely listing closer to $900,000 today, and homes on the water can easily exceed $2 million. One recent single-family home for sale on Mahogany Bay, for example, has listed at nearly $2.6 million with four bedrooms and four bathrooms over 3,316 sq. ft.

That’s still far better than Vancouver where a single-family home with similar square footage has listed for nearly $4.4 million.

As well, activity in the $1-million price range, while brisk, still makes up a small segment of Calgary resales, Neustaedter notes

“As you move down to $600,000 and under, there is much more demand.”

Yet current migration levels and a strong economy are setting the table for more price growth, particularly as supply of homes remains limited.

In turn, it is not inconceivable the benchmark single-family home price could reach $1 million within a few years — at which point out-of-town buyers may no longer see the value in Calgary they do today, Neustaedter adds.

“Eventually, people are going to ask, ‘Why would I move?’”

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