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- Aug 31, 2007
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The properties in this Globe and Mail story certainly won`t cashflow but thought this article was of interest.
See Below.
ROMA LUCIW
Globe and Mail Update
September 5, 2007 at 1:00 PM EDT
Shopping for a luxury home? Get ready to dig deeper because a million bucks just won`t buy what it used to.
A study of 16 markets across Canada by real estate company Re/Max found “an unprecedented upswing” in high-end home sales. Between January and July of 2007, year-over-year sales rose between 13 per cent in Victoria to 521 per cent in Edmonton, with houses at the top end of price range appearing to be in the biggest demand in most markets surveyed.
Elton Ash, the executive vice-president for Re/Max in Western Canada, said a strong economy, particularly in the oil-rich Western provinces, has bolstered consumer confidence to a degree that affluent buyers are comfortable with a million-dollar-or-more real estate investment.
“Recent volatility in the stock market may trigger further investment in real estate as purchasers move to reallocate their holdings,” he said.
The upper-end price point – the highest price at which demand is relatively strong – was greatest in Vancouver at $2-million, followed by the Greater Toronto Area at $1.5-million, White Rock, B.C., at $1.2-million and Victoria, Kelowna and Calgary at $1-million. The cheapest places in Canada to buy a personal palace were Halifax and St. John`s, where the upper-end price point was just $350,000.
According to the Re/Max report, seemingly insatiable demand has created tight market conditions in upscale neighbourhoods and placed mounting pressure on housing valuations. “As a result, the million dollar home no longer holds the same cachet it once did and in larger markets such as Vancouver, Calgary and Toronto it`s simply a starting price.”
Real estate agents in Edmonton sold 87 luxury units in the first seven months of 2007, a 521 per cent jump from last year. Regina, where the upper-end price point is a cool half-million, saw unit sales jump 450 per cent to 11. Buyers in Calgary purchased 311 high-end homes, up 57 per cent from last year.
In the Greater Toronto Area, unit sales rose 28 per cent to 505. The spillover hit the Hamilton-Burlington region, where sales of luxury homes rose 34 per cent to 460.
The high-end housing market has been booming for several years now, attracting a growing number of affluent purchasers who are taking advantage of the increased equity and the capital gains exemption for a principal residence.
Although out-of-province and international buyers have been snapping up some of these luxury homes, locals still account for most sales.
Sales of upscale condominiums are also rising as empty-nesters and retirees scramble to secure smaller properties that require less maintenance than a traditional house. The priciest sale to date was a nearly $5-million condo in Vancouver, while the most expensive listing in that same area carries a whopping price tag of $18.2-million.
The unprecedented and seemingly insatiable appetite for these mega-expensive homes suggests that a growing number of Canadians are in a financial situation to afford them.
Michael Polzler, executive vice-president of Re/Max Ontario-Atlantic Canada, said growth in market capitalization has generated tremendous wealth in recent years. “Inheritance has played a significant role as well, with the download of an estimated $1-trillion amount already under way,” he said.
See Below.
ROMA LUCIW
Globe and Mail Update
September 5, 2007 at 1:00 PM EDT
Shopping for a luxury home? Get ready to dig deeper because a million bucks just won`t buy what it used to.
A study of 16 markets across Canada by real estate company Re/Max found “an unprecedented upswing” in high-end home sales. Between January and July of 2007, year-over-year sales rose between 13 per cent in Victoria to 521 per cent in Edmonton, with houses at the top end of price range appearing to be in the biggest demand in most markets surveyed.
Elton Ash, the executive vice-president for Re/Max in Western Canada, said a strong economy, particularly in the oil-rich Western provinces, has bolstered consumer confidence to a degree that affluent buyers are comfortable with a million-dollar-or-more real estate investment.
“Recent volatility in the stock market may trigger further investment in real estate as purchasers move to reallocate their holdings,” he said.
The upper-end price point – the highest price at which demand is relatively strong – was greatest in Vancouver at $2-million, followed by the Greater Toronto Area at $1.5-million, White Rock, B.C., at $1.2-million and Victoria, Kelowna and Calgary at $1-million. The cheapest places in Canada to buy a personal palace were Halifax and St. John`s, where the upper-end price point was just $350,000.
According to the Re/Max report, seemingly insatiable demand has created tight market conditions in upscale neighbourhoods and placed mounting pressure on housing valuations. “As a result, the million dollar home no longer holds the same cachet it once did and in larger markets such as Vancouver, Calgary and Toronto it`s simply a starting price.”
Real estate agents in Edmonton sold 87 luxury units in the first seven months of 2007, a 521 per cent jump from last year. Regina, where the upper-end price point is a cool half-million, saw unit sales jump 450 per cent to 11. Buyers in Calgary purchased 311 high-end homes, up 57 per cent from last year.
In the Greater Toronto Area, unit sales rose 28 per cent to 505. The spillover hit the Hamilton-Burlington region, where sales of luxury homes rose 34 per cent to 460.
The high-end housing market has been booming for several years now, attracting a growing number of affluent purchasers who are taking advantage of the increased equity and the capital gains exemption for a principal residence.
Although out-of-province and international buyers have been snapping up some of these luxury homes, locals still account for most sales.
Sales of upscale condominiums are also rising as empty-nesters and retirees scramble to secure smaller properties that require less maintenance than a traditional house. The priciest sale to date was a nearly $5-million condo in Vancouver, while the most expensive listing in that same area carries a whopping price tag of $18.2-million.
The unprecedented and seemingly insatiable appetite for these mega-expensive homes suggests that a growing number of Canadians are in a financial situation to afford them.
Michael Polzler, executive vice-president of Re/Max Ontario-Atlantic Canada, said growth in market capitalization has generated tremendous wealth in recent years. “Inheritance has played a significant role as well, with the download of an estimated $1-trillion amount already under way,” he said.
