Luxury home sales plummet

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Luxury home sales plummet
  U) {, P( w+ m; g; ]Slow economy blamed for drop
2 o% G0 p1 R9 T. i1 mThe Edmonton Journal
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EDMONTON - 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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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.

  @7 i5 H3 x9 _8 k% _) x* J7 ?5 C  ?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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! R  o- H9 b8 x/ rFont:****Re/Max blamed a slowing economy and overheated real estate market for the downward trend.
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/ S' R( D; X/ }4 l2 G! Q+ X5 X1 oThe 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.

Re/Max predicts prices will soften this year and a rebound isn't expected until late 2009 when excess housing inventory is sold.

$ M. X& x6 O% \- J% [$ k+ LIn 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.

2 N$ I  d( z1 s1 t9 G% D, T) y4 PBesides 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.
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- l3 C$ u8 j0 L$ A7 d& `* j3 z* g) wHowever, the real estate organization said strength in this market segment is not expected to last.
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/ M# S& ]) V5 D7 o9 e( b) f"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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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 said.
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* F6 D# R. ?& F! I5 \7 GElton 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."

2 P. G5 s1 D7 g: p% R( k* \In 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.
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Each market has a different price point that marks what Re/Max defined 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.



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© The Edmonton Journal 2008

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