August 2013 market update
Midway through 2013, the BC luxury real estate market has rebounded from a sluggish 2012. After breaking all luxury records with 691 $3-million+ sales in 2011, the luxury market slowed to 439 $3-million+ sales in 2012. This year, that number is forecast to reach 588 sales, which represents over $2.8 billion in luxury real estate changing hands in 2013.
This compares to only 10 $3-million+ homes, with a total value of $39 million, that sold in 2000.
Much of the rebound can be attributed to the overall health of the housing market, says Macdonald Realty manager Matthew Lee. Says Lee, “Year-to-date, both in terms of gross sales and units sold, the Greater Vancouver housing market has seen an increase of 10% over 2012, so it’s no surprise that the luxury market has followed suit.”
Dan Scarrow, VP Strategy for Macdonald Realty, agrees. “The luxury market in Vancouver is more intricately linked with the overall market here than in other jurisdictions,” says Scarrow. “We’re a global lifestyle city,” he says, “economists have been trying to figure out the Vancouver market based on local incomes for 40 years now and it’s never made sense.”
Scarrow credits foreign buyers for driving demand for high-end product. “Everyone now knows that mainland Chinese buyers are a big factor in our market now,” says Scarrow, “but we’re actually a repository of wealth for people from all over the world.”
The most striking examples of this have been the two sales this year in the Fairmont Pacific Rim for $15 million and $25 million, respectively. These sales were not made to mainland Chinese buyers, but instead, are rumored to be Middle Eastern buyers. (http://news.nationalpost.com/2013/06/04/ten-things-you-should-know-about-the-near-record-breaking-25m-condo-sale-in-vancouver/) Should these sales hold up for the rest of the year, it would mark the first time in BC history that the most expensive home sold in the province was a condominium unit.
“When foreign investors invest in Canada, they’re not looking for huge returns,” says Scarrow, “they’re looking for a safe, stable place to store their wealth. That’s unlikely to change.”
Top 3 Most Expensive Homes Sold in BC so far this year:
|# PH01 1011 W CORDOVA ST||25,000,000|
|5638 NEWTON WD||18,600,000|
|4815 BELMONT AV||16,000,000|