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Bargains Available In High-End Homes, But Exercise Caution
Article by Jason Luke
The large pit where the Ritz-Carlton’s Vancouver condominium complex was to have been built serves as a stark reminder of the 2008 financial meltdown. The real estate industry, especially the luxury sector, was hit hard by the crisis, and it is uncertain when or if the 58-storey tower will begin to rise.
According to Ross McCredie, CEO and president of Sotheby’s International Realty in Canada, real estate sales literally ground to a halt from October 2008 until the spring of 2009. He said that when the market eventually regained strength, he was surprised at the rapid rate of recovery.
McCredie said that recent sales in Vancouver included a home priced at more than $ 10 million, as well as one priced at $ 9.5 million. Two properties located in Victoria sold not long ago, with prices of $ 6.5 million and $ 6.8 million.
When asked about the sales pickup, McCredie responded that he believed that the financial crisis spurred many wealthy people to re-evaluate their portfolios, and that some have decided to liquidate expensive properties. He said that there might be some good deals available in the $ 3 million-plus category, especially if the properties have been on the market for a long time.
Vacation properties also represent good prospects for buyers, said McCredie. He advised that top recreational areas like Whistler, Mont Tremblant, Okanagan and Muskoka feature properties for sale at prices below their assessed valuations.
McCredie cautions buyers to conduct due diligence before buying or building a luxury property, even though it may resemble a bargain. Resale value is always a consideration; while a large, architecturally unique house may be one person’s dream home, it could be another person’s artistic nightmare. He commented that some people over-build for their lots and neighbourhoods, ignoring the fact that they may have to sell the home someday.
Jason Luke – Real Estate In Burnaby