Luxury Home Sales Experience Unprecedented Growth In Major Markets Across Canada

Across the country, unit sales for homes in the higher end of the market are outpacing the growth of the overall market in most major cities, according to a Carriage Trade Luxury Properties Report released today by Royal LePage Real Estate Services. The report found that sales of high-end homes are growing at an unprecedented rate, with Toronto, Calgary and Winnipeg reporting sales increases of over 40 per cent, year-over-year, in the first two quarters of 2005.

Luxury Home Market Summary Units sold Jan. to Jun.

Units sold Market Price 2005 2004 % change 2004 2003 % change Toronto $1,500,000+ 288 195 48% 368 258 43% Calgary $900,000+ 110 37 197% 75 65 15% Winnipeg $300,000+ 168 81 107% 198 131 51% Vancouver $1,000,000+ 739 627 18% 1037 791 31% Ottawa $750,000+ 40 43 -7% 62 36 72% Source: local real estate boards (TREB, CREB, WREB, REBGV, OREB, NSAR) "Increased sales of larger and more luxurious homes reflect the underlying strength of the Canadian economy � one that has demonstrated a strong performance and resilience throughout 2005 despite the strength of the Canadian dollar," said Phil Soper, president and CEO of Royal LePage Real Estate Services. "Through these purchases, many high net-worth individuals are expressing their ongoing confidence in both the economy and housing investments." Added Soper: "We are also finding that luxury buyers initiate a significant amount of upgrades and renovations, improving their lifestyle while adding to the equity in their homes. " In Toronto sales of homes priced at $1.5 million+ have jumped 48 per cent, year-over-year, in the first six months of 2005 to an historical high of 288 units. During the same period in 2004 there were 195 unit sales. Sales in this price category have experienced the highest average year-over-year growth of all price categories since 1996, increasing at an average of 38 per cent every year.

The carriage trade market in Toronto has continued to thrive over the last several years, as demand for luxury properties remains strong across the city. Inventory levels have been tight for homes in this area of the market, however these properties tend to have longer listing periods than average. There has been a trend for some baby-boomers to downsize from luxury homes into luxury condominiums, which offer a maintenance free lifestyle. Rosedale, Forest Hill and the Bridle Path remain popular neighbourhoods for buyers of luxury properties.

Buyers often have very specific requirements for amenities and will wait longer to find an ideal home that suits all of their needs, favouring completely finished homes that have been recently or fully renovated. Homes that have maintained a traditional fa�ade while having a completely updated interior are most popular. Some purchasers are looking to new construction projects to allow them to tailor a home specifically to their needs.

In Calgary, sales of luxury homes in the first six months of the year have nearly tripled year-over-year, with 110 units sold compared to 37 in the same period 2004. This represents an increase of a 197 per cent over 2004. In fact, more homes priced at $900,000+ were sold during the first and second quarter of 2005 than during all of 2004 (75 units). From 2000 to 2004 sales of homes in this price range have grown at an average of 36 per cent per year in the city, while sales in the overall market has grown at eight per cent per year on average.

The luxury housing market in Calgary has experienced astounding growth over the last several years, as the local energy sector continues to boom and draw new business to the city. Listing periods for luxury homes in Calgary are regularly less than one month, with some sought-after properties selling in less than two days.

Location is the primary motivating factor with properties in the inner city and Mount Royal among the most popular areas. Homes located along the ridge overlooking the city are also in high demand. There is a trend for buyers to purchase a high-end property in a location they like, tear it down and build a new home made to their specifications. Buyers will also frequently purchase a home for over $1,000,000 and then spend an additional $100,000 to renovate it to their specifications.

Sales of properties in the high-end of the market in Winnipeg (homes priced $300,000+) have more than doubled to 168 units in the first six months of 2005, compared with 81 units sold during the same period in 2004 (+107%). Unit sales in this price category have experienced 52 per cent average growth per year between 2002 and 2004 while the overall market average grew by four per cent.

For further information, please contact: Eliza Walsh ([email protected]) or Kate Langan ([email protected]) at Mansfield Communications Inc., phone 416.599.0024

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