If Canadians are not currently living in a luxury home, many aspire to someday live in the lap of luxury. As a result, the number of unit sales of luxury homes has skyrocketed in Canada’s major markets, according to the Carriage Trade Luxury Properties Report released by Royal LePage Real Estate Services.
The report found that there has been a surge of unit sales in all the markets studied with the greatest increases occurring in Calgary, Edmonton and Halifax, which all reported sales increases of more than 125 per cent year-over-year in the first three-quarters of 2006.
In Winnipeg, there was a 25 per cent increase over 2005 with the sale of 45 homes over $500,000 from January to September this year. Included in this figure is the sale of a home in Tuxedo at just over $2 million.
“Due to high consumer confidence in the market, a large number of executive transfers to leading blue-chip companies, and baby boomers looking to trade up,” according to the report, “Winnipeg’s luxury housing market has experienced a boom in the last year.
“Tuxedo and East St. Paul are among the city's leading areas that attract luxury home buyers. Tuxedo ... boasts homes with character that are approximately fifteen years old.
“East St. Paul is an emerging area just outside of Winnipeg and includes one of the city’s most wealthy communities — Pritchard Farm Estates. Luxury homes in this area are situated on large lots and are close to the lake.”
The report, which includes a market analysis of trends and activity in major markets across Canada, combined with a national omnibus poll conducted by Maritz Research Canada, found that 37 per cent of Canadians aged 18 and older currently live in a luxury home, plan to buy a luxury home soon, or aspire to one day live in a luxury home.
“The pronounced increase in the number of luxury homes sold across the country is a strong reflection of Canadians’ confidence in the economy and the real estate market,” said Phil Soper, president and CEO of Royal LePage Real Estate Services.
“For the substantial sums that these homes command, buyers have come to expect distinctive properties outfitted with luxurious amenities, where it is clear that painstaking attention has been paid to every detail.”
The most important criteria Canadians considered when choosing this type of home were investment potential (25 per cent), proximity to excellent schools (19 per cent), the prestige of the neighbourhood (17 per cent), luxurious amenities throughout the house and the size of the house (11 per cent) and the well-known neighbours (eight per cent).
In order for a home to meet the Carriage Trade distinction, it must be situated in a prestigious, sought-after neighbourhood, feature high-end amenities and be priced within a predetermined range.
“House values have appreciated much more quickly than the underlying economy for much of this decade,”said Soper.
In terms of the feature that would be the most important to Canadians if they were purchasing a luxury home, a commercial-style kitchen assumed top rank at 21 per cent in the poll. Interestingly, a gender divide was evident when it came to cooking as 26 per cent of women cited the commercial-style kitchen as the most important feature, compared to 15 per cent of men.
The men’s den prevails with 11 per cent of males citing the luxury in-home movie-viewing theatre as the feature that would be most important to them if they were purchasing a luxury home, compared to only five per cent of females.
Among the favoured amenities in Winnipeg's luxury homes are exotic wood flooring throughout, custom-built kitchens, media rooms and very high-end fitness rooms, according to the report.
The poll also found additional features that would be of most importance to Canadians if purchasing a luxury home to include an indoor or outdoor pool at 14 per cent, smart wiring at 12 per cent, heated floors and driveway at 11 per cent and a fitness centre/pilates/yoga studio and luxury in-home movie theatre both at eight per cent.
In Calgary, sales of luxury homes priced at $1-million and above have risen dramatically. Unit sales in the period of January to September 2006 have more than doubled when compared to the same period in 2005 — from 91 to 237 units sold — an increase of 160.4 per cent.
Calgary’s luxury home market has experienced phenomenal growth over the past few years which is a direct result of the burgeoning oil and gas sectors. Many of the luxury home buyers in the city are oil and gas executives or entrepreneurs with junior oil companies, a significant number of whom have relocated from other provinces or the U.S.
In Edmonton, sales of homes priced at $700,000 and above skyrocketed by 128.6 per cent year-over-year in the first nine months of 2006 to 96 units sold, compared to 42 units sold during the same period in 2005.
Average house prices in Edmonton have experienced unprecedented growth over the last year, resulting in luxury home prices reaching new heights.
In Vancouver, the number of luxury home sales at the price of $1 million and above has increased by 57.2 per cent year-over-year from 1,231 sales from January to September 2005 to 1,935 units sold during the same period in 2006.
Vancouver boasts being the city with the greatest number of homes sold over $1-million-plus of any major urban centre in Canada.