Leading the Nation in Luxury

Spurred by strong employment and an influx of new Calgarians, the city’s upper-end real estate market continued to lead the nation in nearly every category this year.

According to a report from Sotheby’s International Realty Canada, Calgary’s continuing economic prosperity has heightened demand for top-tier real estate, even in the wake of the floods that struck the city this summer.

“I think [sales] are going to do very well, and I think what’s interesting from our perspective, especially in Alberta, is we think the numbers could have been significantly better than they were had we not gone through the flood and everything we’ve been through,” said Ross McCredie, president and CEO of Sotheby’s International Realty Canada.

As it is, the numbers coming out of Calgary’s luxury market are quite impressive. In August alone, 64 homes priced at $1 million or more were sold in the city, doubling the number seen in August of 2012 and setting a record for most million dollarand- up home sales for the month.

According to Sotheby’s Top-Tier Real Estate Report, activity in Canada’s high-end real estate market in the first half of 2013 gained traction over 2012, with Calgary leading the way with a 67 per cent increase, while Vancouver sales were up 65 per cent and Toronto 61 per cent.

Through the first eight months of 2013, 524 homes priced at $1 million or more have been sold in Calgary, marking a 42 per cent increase over the 370 similarly priced homes sold through the first eight months of 2012.

Breaking down the increases, million- dollar plus single-family home sales increased from 348 in the first months of 2012 to 471 during the same period in 2013. After eight months, million-dollar plus condo townhome sales more than tripled in 2013, rising to 25 from just eight in 2012, while luxury condo apartment sales doubled from 14 to 28.

One reason for the upsurge in sales seen in the city is the number of new people moving here. In this year’s city census, Calgary’s population increased by almost 30,000 residents. Province-wide, Alberta gained 27,100 new residents during the first quarter of 2013 alone, the highest level of growth on record.

According to Sotheby’s, it is estimated for every 300 square feet of new office space created, an additional person is added to downtown Calgary.

“The high number of executive level jobs created will continue to fuel demand for top-tier real estate specifically, as newcomers take advantage of the city’s relatively affordable real estate market to ‘buy up’,” said the report.

Prompting on the number of Calgarians who have been able to upgrade is the number of homes for sale in the luxury market. The size of the luxury home market itself has been growing, representing 3.1 per cent of total sales in the city, up from the 2.4 per cent share recorded last year. While yearto- date listings in the city decreased by 1.22 per cent through the first eight months of 2012, listings of $1 million plus homes have increased by 23 per cent.

“When considering the level of new listings, there has been a rise in availability in the higher end of the market, compared to declining new listings in property priced below $500,000,” said CREB® chief economist Ann-Marie Lurie. “While overall supply levels are declining, that is particularly true for affordable single-family homes. The increased selection in the luxury market, combined with rising wages and a positive long-term outlook for the city could provide an opportunity for those looking to upgrade.”

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