Increased upper-end sales driven by good economy

Luxury home sales through MLS® have  doubled this year from the previous high a year ago, according to a new report on local upper-end sales.

The number of luxury homes sold in excess of $500,000 year-to-date has risen from 12 to 24 units. Of these 24 MLS® sales, six went for over $1 million.

A Wellington Crescent home sold for $2.025 million, the highest price ever in the history of the local MLS®. This sale took all of six hours, while most sales in the top end of the market take about six weeks to sell.

“Many people are investing in their properties, moving up to larger homes and/or better neighbourhoods,” according to the recently-released RE/MAX Upper End Report. “Wellington Crescent, Linden Woods and Linden Ridge, Tuxedo, River Heights and Royalwood are the most coveted addresses in Winnipeg.

“Outside the city, the capital region offers upscale communities such as East St. Paul where an abundance of new, upper-end construction is underway.”

“Who would have thought that in  only five years our over $300,000 price range for residential-detached sales would go from only six sales to 75 in May alone, with three of them selling for over $1 million,” said Winnipeg Real Estate Board president Walter Boni.

The report said that upper-end sales are being driven by ongoing good economic fundamentals with full-time job growth leading the way.

According to Statistics Canada, Manitoba has the second lowest unemployment rate in Canada at 4.2 per cent. Only Alberta has a lower unemployment rate at 3.4 per cent.

The RBC Financial Group is forecasting that Manitoba’s economy is expected to grow by 3.3 per cent in 2006.

“Manitoba’s economic growth remains healthy thanks to a well-diversified economy,” said Craig Wright, RBC’s vice-president and chief economist.

RBC noted that investment will grow this year when compared to last year because of ongoing strength in new home construction, sales of existing homes and retail sales.

“Supply and demand are major factors in today’s marketplace,” said the RE/MAX report, “with approximately one in every two homes selling at or above list price.”

“There are currently 33 luxury homes listed for sale,” according to the RE/MAX report, “which translates into one or two homes in each (of the upper-end) neighbourhoods. Still, multiple offers in  the top end are an exception.”

The report said that homes are being purchased in the upper-end neighbourhoods such as North River Heights and Wellington Crescent and then frequently torn down to make way for new homes.

“Large, well-treed lots and a good sense of community are attracting purchasers to these areas. Renovations are also a popular choice, with most purchasers choosing to maintain the original integrity of the home.”

The report also indicated that luxury condominium sales on Waterfront Drive in Winnipeg’s Exchange District are gaining momentum. New upper-end condo construction underway along Waterfront Drive includes such projects as Ship Street Village, The Strand, Sky Waterfront and The Excelsoir.

“Empty-nesters are helping to revitalize the downtown area,” said the report. “Starting at$350,000 for the ‘shell,’ it is not uncommon for purchasers to spend an equal amount in improvements and upgrades to the condominium.

“Made-in-Manitoba success stories are behind the push for upper-end homes,” added the report. “Typically, these affluent buyers, aged between 30 to 50 years of age, are choosing homes reflecting their status and lifestyle.”