GREATER (METRO) VANCOUVER
JULY 2010 QTLY UPPER-TIER REAL ESTATE UPDATE
ODD CYCLES BUT SEGMENT STRENGTH PERSISTS
We continue to believe that the real estate market can only be considered strong when the upper tier reflects price resilience. This remains the case at the moment in Greater Vancouver considering the 2010 second quarter figures (see below).
We start with a quote from the most recent RE/MAX report – concerning predominantly the first quarter of this year. (Remember this is an aggregation of “13 major Canadian centers and 5 sub markets”.) Their opening remark is as follows – “Luxury home sales soared in the 1st quarter of 2010 as affluent purchasers moved to take advantage of favourable market conditions across the country”. They base this “serious upswing in sales” on “improved economic performance, increased personal wealth, immigration and foreign investment”. “Nine out of the 13 markets examined (69%) shattered existing records – setting new all-time highs for 1st quarter activity in the upper end”.
This rosy picture (nationally) is mimicked in Vancouver, however, the two year roller coaster we currently inhabit is troublesome. Steadily climbing or steadily declining graphs are far more readable and enlightening. So here goes. Late 2009 and early 2010 (with ‘time off’ for the February Olympics) were generally bullish. Then came the HST debacle coupled with international economic confusion (what we’ve heard called “the Greek Disconnection”).Where does that put us right now – this mid-year oasis? Well, inventory, homes on the market, has steadily risen since about the 3rd month of this year. A subtle change may well be occurring – early July numbers see a drop below the higher levels of May and June. This could well herald a more positive trend leading us closer toward a more balanced upper tier market. There is some consensus that buyers will realize in the upcoming month or so that we are receding from the environment where the best (lower price) purchases could have been made. There may still be a window to negotiate strongly with the help of an experienced Realtor and, remember, mortgage rates are still at a reasonable level. The dire predictions of rapidly climbing rates have not materialized.
Now the second quarter 2010 figures extracted from the REBGV database upon which we have based these comments.
Detached homes sold [$2MM and above] 2010 – 226 listings sold vs. 2009 – 171 sold (an increase of 32%). Highest sale $11.08 MM (’10) vs. $11.3MM (’09). This property – on Osler St, sold in May ’10 after 98 days on the market, originally listed at $16.8MM. 7 bed/8 bth, it is a 15,260 sq ft structure on a 172 x 238 gated, W facing manicured property – An elegant Shaughnessy mansion. Truly a home of provenance.
Attached homes, those best described as townhomes and duplexes [$1MM and above] 2010 – 76 units sold vs. 2009 – 49 sold (an increase of 55%). Highest sale $7MM (’10) vs. $3.345MM (’09). This property on Point Grey Rd which sold in Jun ’10 after 132 days on the market was listed at $7.998MM. A view, Kitsilano, 3bd/3bth ½ duplex with 3451 sq ft of living space.
Apartments [$1MM and above] 2010 – 132 units vs. 2009 – 99 sold (an increase of 33%). Highest sales were 2 @ $5.8MM (’10) vs. $5MM (’09). They are i) an ultimately luxurious 51st floor, 2 level, 20ft ceiling suite in Shangri-La. Listed at $6MM, it sold Apr 2010 after 5 days on the market and ii) a 25th floor, equally luxurious 3600 sq ft suite with panoramic views in Two Harbour Green. Listed at $6.3MM, sold May’10 after 44 days.
An enquiry has led to the inclusion of the following information. Current inventory (listings): Detached ($2MM and up 804) – Highest $29.9MM – 26 over $10MM Attached ($1MM and up169 ) – Highest $3.598MM – 4 over $3MM Apartments ($1MM and up 486) – Highest $10.8MM – 3 over $10MM
We generally do not place too much store on “asking” prices, as the only true measure of a market is a “sale” price. These are however included because they are obviously of interest. It does underline the fact that unique properties are often challenging to price.
The most interesting period will likely be the 2nd half of this year and we will indeed see how things unfold and if this strength persists. Our feeling is that the upper tier will continue to be strong.
Again, visit the website to see the new developments. We continue our commitment to keep you up to date on Vancouver’s … www.HomesOfProvenance.com – the “go to” site for Upper Tier Real Estate analysis and jumping off point for market listing information.
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