Luxury home sales plummet

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Luxury home sales plummet
Slow economy blamed for drop
The Edmonton Journal
8 v  B3 v0 h7 XPublished: 2:33 am
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.

' Q' x9 b! w' m: e) DSales 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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2 q4 n& u2 G9 H% B6 MFont:****Re/Max blamed a slowing economy and overheated real estate market for the downward trend.
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The 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.

9 m/ ^& e) O) N4 ^Re/Max predicts prices will soften this year and a rebound isn't expected until late 2009 when excess housing inventory is sold.

  g8 U' \8 v; ?8 g* bIn Calgary, where Re/Max defines a luxury home as costing $1 million or more, sales dropped 17 per cent to 258 from 312 units. And there's lots of choice for high-end buyers -- 395 properties are currently listed.
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Besides Edmonton and Calgary, sales fell in Toronto, Hamilton and Kelowna. Those cities bucked the national trend that saw sales rise in 10 of the 15 major Canadian markets tracked.
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: z' q- v* K7 j6 M7 F2 RHowever, the real estate organization said strength in this market segment is not expected to last.
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  f4 w% E5 k) e% k9 X( S% ]$ x"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.

! u2 g/ q# p3 yBut 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.

% I5 b5 w* s1 Z$ MElton 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."
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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.
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/ J* P/ l, D% Y4 RIt 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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