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Canada's luxury home sales still strong

By: Derek Abma
National Post
September 27, 2008

Luxury home sales in Canada have been surprisingly strong, given the uncertain economic climate and growing weakness in the general housing market, says a report released Thursday.

Real estate group Re/Max says sales of "upper-end" homes -- defined as roughly the top 5% of homes in terms of price in their respective markets -- were up during the first seven months of this year in 10 of the 15 major Canadian markets tracked.

It says sales in all but two markets, luxury homes were the best-performing category in terms of sales performance compared with last year.

However, the real estate organization said strength in this market segment is not expected to last.

"The market for luxury homes is usually the first to show pressure cracks, but the reverse is actually true this year, with pent-up demand (due to trade-up activity), less speculation and job transfers all factors contributing to stability in this segment," Michael Polzler, Re/Max's executive vice-president for Ontario and Atlantic Canada, says in statement.

But financial market conditions and more higher-end homes being put up for sale are expected to curtail both sales volumes and price levels in the coming months, Re/Max says.

Elton Ash, Re/Max's executive vice-president for Western Canada, says in a statement that "we are seeing a return to more balanced conditions. This situation is expected to have an impact on high-end values in coming months, especially in areas that have experienced consistent double-digit growth."

Posting the highest growth proportionally were Regina at 306%, Winnipeg at 89%, and St. John's at 78%.

Sales declines occurred in Toronto, Hamilton, Calgary, Edmonton and Kelowna, B. C.

Each market has a different price point marking what Re/Max defines as the start of the luxury-home category. It ranges from about $2-million in Greater Vancouver to $1-million in Calgary to $750,000 in Ottawa and $400,000 in St. John's and Halifax.

Re/Max says the most expensive MLS residential sale this year was for $11.5-million in the Vancouver area. A property in Toronto was listed at $9-million but a bidding war pushed the sale price to more than $11-million.

The highest-priced listing in the country is the penthouse on the 55th floor of the Four Seasons Hotel under construction in Toronto, with an asking price of $30-million.

Posted on Saturday, September 27, 2008 at 01:32PM by Registered CommenterElaine in | Comments1 Comment | References1 Reference

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Reader Comments (1)

I'm glad to see home sales in Canada have stayed high. I think I'll start looking at expanding into the Canadian market.

Thanks for the info.
February 26, 2009 | Unregistered CommenterMathew Bossert

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