What a weird MARKET!! “Local luxury-home sales up 26 per cent from last year,” ReMax says

Below is an article in the Edmonton Journal regarding the luxury market in Edmonton.

While homebuying activity is cooling in Edmonton, luxury-home sales are picking up, says a new national report by ReMax.

“One area of the market that has outperformed all others is the upper end,” said the ReMax Market Trends Report Fall 2010, released Tuesday.

Sales of homes priced at more than $700,000 are up 26 per cent over 2009, with 240 upscale properties changing hands as of August, compared with 190 in the same period last year, it said.

Fifty-five homes in the Edmonton area sold for more than $1 million in the first eight months of the year.

The urgency seen earlier this year in Edmonton’s residential housing market — prompted by tighter lending policies and the threat of higher interest rates — has given way to more stable conditions heading into the fourth quarter, the report said.

“Positive announcements in the oil and gas sector should spur renewed activity in residential real estate — as evidenced in the first few weeks of September,” it said.

“Despite recent hikes, interest rates remain attractive, with a five-year closed hovering at four per cent. The outlook for the remainder of the year is stable, with no real fluctuations in either sales or price.”

Year-to-date sales have slipped 14 per cent to 11,773 units, compared with 13,694 in the same period last year, the report said.

The sales-to-listing ratio is now 47 per cent, down from 59 per cent in 2009, but up from 42 per cent in 2008.

Average price is holding steady, up about four cent to $332,789 in 2010. That’s about $12,500, or 3.9 per cent, higher than a year ago, when the residential average was $320,289, the report said.

Inventory levels are up marginally over last year, but down from peak levels reached in 2007 and 2008, ReMax said.

“As a result, the housing market has been characterized as balanced, slightly favouring the buyer,” the report said.

First-time buyers in Edmonton remain most active, driving sales of single-family homes between $250,000 and $350,000. Condos represent 34 per cent of residential sales.

An influx of new units recently has pushed up supply, putting downward pressure on condo prices, the report said.

Tighter lending rules, requiring a 20-per-cent down payment, are “proving to be detrimental to investment activity.”

The report, which covered trends and developments in 19 major centres from January to August, found year-to-date sales ahead of 2009 levels in 11 markets.

Prices were up year-over-year in all cities, with five experiencing double-digit gains in 2010: Vancouver, St. John’s, Sudbury, Winnipeg and the Greater Toronto Area.

“We cleaned up in the first quarter of 2010 because housing activity during the same period one year earlier was dismal,” said Elton Ash, regional executive vice-president of ReMax, Western Canada.

“We’re now comparing the second half of the year to 2009 and falling short of expectations. Looking at the big picture, however, the market remains healthy.”

Read more: http://www.edmontonjournal.com/business/Local+luxury+home+sales+cent+from+last+year+ReMax+says/3630681/story.html#ixzz11kVn25We

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Michael Pino (Edmonton Luxury Properties), Re/Max Elite
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