Luxury home sales plummet

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Luxury home sales plummet
Slow economy blamed for drop
; v6 b4 C) P/ K# G* ^The Edmonton Journal
( |: C+ `% n' E0 v+ f2 OPublished: 2:33 am
8 \1 Z1 s- x- W5 {; n9 M/ VEDMONTON - Sales of luxury homes in Edmonton dropped 39 per cent in the first seven months of the year compared to 2007, says a report released Thursday.
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7 t- E+ T! \6 f# ?) T( ?Real estate group Re/Max said 110 homes priced at $850,000 or more sold in the period during 2007 but the number dropped to 67 this year.

Sales over the $1-million mark dipped to 40 from 45. There are currently 218 properties for sale that top the $850,000-mark and average number of days on the market jumped to 72 in 2008 from 59 last year.

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' r4 b+ f2 Z# C: @Font:****Re/Max blamed a slowing economy and overheated real estate market for the downward trend.

The top price for an MLS sale this year was $2.25 million, while the highest-priced listing is a $6.9-million property in Crestwood. A $1.39-million property in Strathcona is the highest price condo on the market.

( q. C8 o4 W( n% s7 y- p% rRe/Max predicts prices will soften this year and a rebound isn't expected until late 2009 when excess housing inventory is sold.

" ]  |" Z  U/ |2 o6 E& l3 OIn Calgary, where Re/Max defines a luxury home as costing $1 million or more, sales dropped 17 per cent to 258 from 312 units. And there's lots of choice for high-end buyers -- 395 properties are currently listed.
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0 B* N$ E) c( y5 p- B- |Besides Edmonton and Calgary, sales fell in Toronto, Hamilton and Kelowna. Those cities bucked the national trend that saw sales rise in 10 of the 15 major Canadian markets tracked.

6 I5 D; k/ e& e# b) g. f  c3 r  N& NHowever, the real estate organization said strength in this market segment is not expected to last.
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/ t; [: l* P+ ^. N( R" K"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, said in statement.
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1 n9 `, p9 a0 Z( SBut 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 said.

Elton Ash, Re/Max's executive vice-president for Western Canada, said, "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."

# C& d7 Y  E" a- TIn terms of growth in upper-end homes sales, Regina saw the most proportionally this year at 306 per cent. Winnipeg was next at 89 per cent, followed by St. John's, N.L., at 78 per cent.

$ a  ]. p* x/ v7 f0 @Each market has a different price point that marks what Re/Max defined as the start of the luxury-home category.

- I( l/ d1 `2 i3 _; qIt 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.
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© The Edmonton Journal 2008

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