According to a recent study released by Sotheby’s International Realty Canada, the Vancouver real estate market saw a big shift in luxury consumer sentiment during the second quarter of 2022. A fevered sellers’ market is now one that’s much more balanced.
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Overall, $4 million-plus sales fell 18% year-over-year in the first half of 2022. However, condominium sales over $1 million and $4 million were up 20% and 32% year-over-year. According to the Sotheby’s study, nine properties sold over $10 million on MLS during this time, compared to 16 sold in the first half of last year.
Sales of $4 million-plus single family and attached homes fell 22% and 40% year-over-year from historic records from the first half of 2021. But luxury condominium sales over $4 million were up 32% year-over-year. Residential sales over $1 million were down 18% year-over-year in the first half of 2022.
Other brokerages are seeing the same changes in Vancouver real estate conditions. Regarding Luxury spoke with Faith Wilson, whose brokerage with Christie’s International Real Estate has been servicing discerning buyers and sellers on the Vancouver scene for 30 years.
Vancouver real estate, Instagram @faithwilsonrealty
We are hearing a lot about a “re-balancing” of the luxury and ultra-luxury market in Vancouver between the first two quarters of 2022, especially, with sales in the over-$4 million category dropping. Can you shed some light on that? What are you seeing, at ground level?
This can be a little stickier. However, it does depend on the type of product and exactly where it is located. That being said, the ultra-luxury market has no boundaries; people will pay the price for what they like. At the ground level, the $6M to $8M range is the toughest range for brand new builds.
(With the ultra luxury market), yes, they will still be cognizant of price, but they will still purchase what they like because they can. They don’t need a mortgage.
What are some of the fundamentals that make the luxury and ultra-luxury real market in the Vancouver area as strong as it is?
The absolutely stunning geographical landscape that Vancouver is in the midst of. That, coupled with clean air, clean water, a safe environment, and great schools, is a winning combination. People love it, which brings us to the fact that we are a melting pot of ethnicities, and which means we have a plethora of fabulous food at our fingertips. If I didn’t mention, where else can you go skiing in the morning and golfing in the afternoon?
Vancouver real estate, Instagram @canada_sir
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How is world volatility impacting the luxury real estate market and B.C.?
Because of the volatility that you mentioned, Canada, and of course then B.C., is being scrutinized as a safe haven for investors from other countries and continents. Therefore, we will continue to see more investors and families looking at and coming to B.C. either to invest their wealth or to live here.
In Toronto, the ultra-luxury market, with its cash buyers, are really focusing on pre-construction properties, with larger floor plates, and hotel-like amenities, more and more. Are you seeing that in Vancouver, or other markets in B.C.?
Our market is different here, largely because our city is significantly smaller than Toronto. Therefore, we are a bit more spread out. Yes, our luxury market includes high-end condominiums, but it is also high-end homes that people may look to purchase. Thus safety, a turn-key for service providers of the home, will be important.
Vancouver real estate, @faithwilsonrealty
Where do you foresee the luxury and ultra-luxury market heading into 2023?
I would say that we will continue to see more balancing in the market overall, which will extrapolate out to higher-end homes. I will still stress that there is a disconnect between luxury and ultra-luxury, as people who can afford whatever they want will buy whatever they want. Yes, they will still be cognizant of price, but they will still purchase what they like because they can. They don’t need a mortgage.