Sales of houses $3 million-plus up 80 per cent over same period last year
Buyers from mainland China and a dwindling supply of high-end detached homes are driving Vancouver’s luxury real estate market, with has seen an 80-per-cent increase this year compared to 2014 in the number of sales over $3 million.
The latest numbers from RE/MAX show that 532 single-family houses sold for at least $3 million between Jan. 1 and July 31, a period that also saw a 41-per-cent increase in sales of homes over $1 million.
The highest end of the market is largely driven by offshore buyers hoping to relocate their families to Vancouver, according to Wayne Ryan, managing broker at RE/MAX Crest Realty Westside.
“Mainland China is churning out millionaires at quite a huge rate, and many of them like Vancouver,” Ryan said. “At this point, it’s all anecdotal, but the reality is we’re finding it’s between 70 and 75 per cent (of buyers.)”
He added that a weak Canadian dollar, coupled with a strong Chinese currency, is helping to make Vancouver a particularly attractive place to buy. Meanwhile, local homeowners seem to be sitting on their real estate rather than selling it, driving the price up even further.
The most expensive piece of real estate sold so far this year was a $17.55-million property with a view on Drummond Drive in West Point Grey. According to Ryan, the sale was based primarily on the value of the land.
“The ultimate plan for many of these places, especially for older homes, is to knock it down and rebuild,” he said.
The high demand from foreign buyers has created huge opportunities for Vancouver realtors to diversify. Because so many of buyers plan to relocate from the other side of the world, they’re looking to their real estate agents for help with more than just home shopping.
“They’re doing research on the good schools, they’re helping them buy cars and insurance,” Ryan said.
RE/MAX also reported a huge increase in the number of condo sales valued above $3 million, from 23 apartments in January-July 2014 to 40 in the same period this year — an increase of 74 per cent. The priciest condo sold so far this year was a $7.75-million unit in Coal Harbour.
But the luxury condo market is a completely different beast from the market for single-family homes, according to Ryan.
While there are a good number of condo buyers from China, they’re competing with people from Europe and the Middle East, as well as affluent locals — many of whom are the very same people who’ve cashed in by selling their Vancouver homes for millions.
“They’ve got the option of moving to White Rock or Tsawwassen, or they downsize into a condo. Often it’s a high-end, luxury condo,” Ryan said.
More condo buyers are investors, too.
“A lot of international investors will say, Vancouver’s a very safe market, so they’ll park their money here. That’s why you hear so much discussion about these apartments sitting vacant,” Ryan said. “Because money isn’t an issue — it’s not as if they need to rent them on Airbnb.”
BY BETHANY LINDSAY, VANCOUVER SUN SEPTEMBER 1, 2015