Posted by & filed under Bayview Project, Prestigious, Victoria Real Estate Update.

We just sold a beautiful home for $1,490,000 and the demand for these types of homes here in Victoria and in British Columbia in general is on the rise. A recent article by Darron Kloster, Times Colonist reads:

Luxury home sales continue to rise with no end in sight

The club of real-estate millionaires across the capital region added 137 new members over the first half of the year — and there’s no end in sight for home-buyers willing to lay out more than seven digits for luxury homes in Canada’s most temperate climate, according to a new report.

It’s the fourth consecutive year that Greater Victoria has witnessed a rise in the sale of million-dollar-plus homes, according to the Upper-End Market Trends Report issued yesterday by Re/Max. The 137 sales from January to July was 13 per cent higher than the same period a year ago, when 128 homes sold for a million-plus, and nearly triple the 46 sales from 2004.

Ray Blender, general manager of Re/Max Camosun with four offices and 176 REALTORS® across the city, said million-dollar homes are no longer exclusive to Oak Bay and North Saanich, but spread around all 13 municipalities, and involve several new condominium projects.

And it’s no longer well-to-do retirees joining the club, either, but often young professional couples willing to take on longer, more expensive mortgages for the perfect home.

There are more than 300 listings currently priced at more than $1 million in Victoria, with the properties averaging 77 days on the market, according to the report, noting some ocean-front listings move within days and get multiple offers.

The highest price so far this year sold for $5.95 million while the most expensive home on the market is $28.5-million, 15,900-square-foot ocean-front property on 2.5 acres.

Greater Victoria set a record earlier this week when the average price for a single-family home hit $576,632. The median price is $515,000.

Re/Max says strong markets have helped create wealth and have driven the real estate market.

The report says infill along the waterfront is more frequent as older homes built in the 1940s and 1950s are being demolished for custom-built estates. It also noted new condo developments like Bayview on the Songhees and Quigg Properties at Bear Mountain, offer million-dollar-plus penthouses. “Developers are anticipating increased demand for luxury condominium projects with the graying of the population,” says Re/Max.

Buyers are mostly local, but the report notes surges of out-of-province buyers, primarily from Alberta who are “taking advantage of substantial equity gains” while others are buying with retirement in mind.

Re/Max said a strong local economy, backed by increases in inheritance payouts and strong stock-market gains is behind the increase in high-end sales.

Across the country, luxury home sales have been “unprecedented” over the first seven months of this year, says the report.

In the study of high-end home sales in 16 markets, sales activity bumped as high as 521 per cent. The strong market for luxury property echoes what is going on in the overall resale market which is on pace for a record year, according to the Canadian Real Estate Association.

“The consumer demand for luxury property has been insatiable,” says Michael Polzler, an executive vice-president with Re/Max. “Unabated demand throughout the year has created tight market conditions in a number of blue chip neighbourhoods. Limited availability of product has, in turn, placed mounting pressure on housing sales.”

Re/Max says the strong demand has put so much pressure on prices that a $1 million is just a starting price for a luxury home in some markets.

“The million-dollar home no longer holds the same cachet it once did,” says Polzler. For the purposes of its survey, Re/Max listed all homes that sold for $1.5 million or more in the Greater Toronto area as luxury. In Vancouver, luxury homes start at $2 million while in Victoria it was $1 million.

In Edmonton, where $900,000 is the threshold to what is considered a “luxury home,” there were 311 sales in the first seven months of the year, a 521 per cent increase from a year ago.

Booming Saskatchewan, which has boasted some of the highest percentage price increases in Canada over the past year, also has a red-hot luxury market. Re/Max says you now need $500,000 to buy a luxury home in Regina or Saskatoon. Regina luxury sales are up 450 per cent through the first seven months of 2007 compared to a year ago. Saskatoon sales are up 328 per cent during the same period.

“Strong economic performance, especially in western Canadian provinces, has bolstered consumer confidence levels to such a degree that purchasers in the upper-end are comfortable with a million dollar-plus investment in real estate,” says Elton Ash, regional vice-president of Re/Max of Western Canada. With files from Canwest News Service End of Article.

We have said this for som time now that the upward pressure on properties in provinces like Saskatchewan will effect our own market. The next twelve months will be very interesting.

Cheers, Anders

Anders Treiberg, Associate Broker, REALTOR®

Properties in Victoria Professionals-Royal LePage Coast Capital.

Anders Treiberg has been a REALTOR® in Victoria since 1990. He has extensive Real Estate Expertise and can be reached on his website www.PropertiesInVictoria.com of via email at anders@PropertiesInVictoria.com

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