LACK­LUS­TRE LUX­URY

StarMetro Calgary - - COOL STUFF - MARIO TONEGUZZI

Aguest colum­nist

s a for­mer long-time writer with the Cal­gary Her­ald fo­cus­ing on the real es­tate beat, I knew how pop­u­lar cov­er­age of the real es­tate in­dus­try was to read­ers.

One as­pect of the in­dus­try peo­ple al­ways loved read­ing about was the city’s lux­ury home mar­ket. So, I was cu­ri­ous how the high-end seg­ment of the hous­ing mar­ket has been far­ing lately.

Year-to-date sales – up to the end of April – of $1-mil­lion-plus prop­er­ties to­talled 204 trans­ac­tions, which is down slightly from 211 dur­ing the same pe­riod a year ago, says Ann-Marie Lurie, chief econ­o­mist with CREB®.

When we ex­am­ine an­nual sales num­bers from the last few years, it’s easy to see lux­ury home sales are tied to the strength of the econ­omy.

When Cal­gary’s econ­omy was fir­ing on all cylin­ders in 2013 and 2014, MLS® Sys­tem sales at the higher end of the mar­ket to­talled 726 and 847, re­spec­tively.

Sales num­bers dipped to 511 in 2015, when the re­ces­sion started im­pact­ing the city, but bounced back to 607 in 2016, and 678 last year.

“We started to see some im­prove­ments last year in terms of sales ac­tiv­ity. There have been some price corrections in that area of the mar­ket, or at least some price de­clines. And that en­cour­aged some peo­ple to step back into the mar­ket,” said Lurie.

“Now this year, prob­a­bly like ev­ery other cat­e­gory, we’re just see­ing slower sales ac­tiv­ity … Well below what we re­ally saw happening be­fore. It was start­ing to creep up, but it’s come off a bit.”

Slower sales ac­tiv­ity has meant an uptick in sup­ply lev­els in the high-end mar­ket, but this has been con­sis­tent across al­most ev­ery other price cat­e­gory in the mar­ket.

“Last year, for per­spec­tive, over the first four months it av­er­aged around 6.73 months, which was ac­tu­ally in the grand scheme of things not that bad con­sid­er­ing,” said Lurie.

“It has picked up to over eight months again. There’s just more sup­ply in that mar­ket now.”

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