Sotheby's International Realty Canada

Sotheby's International Realty Canada

June 02, 2016 09:00 ET

Victoria Luxury Home Sales Soar 240% as First Half of 2016 Draws to Close

Demand for $1 Million-Plus Detached Single Family Homes Intensifies in Greater Victoria, Propelled by Vancouver Market Conditions

VICTORIA, BRITISH COLUMBIA--(Marketwired - June 2, 2016) - Sotheby's International Realty Canada today released data revealing significant gains in single family home sales over $1 million in Greater Victoria from January 1 to May 31, 2016, reflecting strengthening demand for luxury homes in the region.

In the first five months of 2016, the volume of detached single family homes sold over $1 million increased 240% year-over-year to 388 units, an increase from 114 homes sold at this price range during the same period in 2015. The $4 million-plus market also experienced a significant upswing during this period, as the market absorbed ultra-luxury homes at a velocity not experienced in recent years. Eight detached single family homes in the $4 million-plus bracket sold in Victoria during the first five months of this year, a substantial year-over-year increase given that there were no single family homes sold over the $4 million-plus mark during the same period in 2015. Multiple offers and sales over asking price indicated sellers' market conditions, and the luxury neighbourhoods of Oak Bay-Gordon Head, North Saanich and James Bay experienced some of the greatest demand within the Greater Victoria region during this time.

According to Sotheby's International Realty Canada, demand for top-tier real estate in Victoria is expected to remain strong as the first half of 2016 draws to a close, propelled by consumer confidence due to local economic optimism and below-national average unemployment rates, growing interest and migration from Vancouver homebuyers seeking alternatives, escalating interest from Alberta buyers, and increased awareness of Victoria real estate as an investment opportunity for buyers from mainland China.

"We expect to see the intensity experienced in the first few months of 2016 to remain into the foreseeable future," predicts Tom Stratton, Managing Broker for Sotheby's International Realty Canada in Victoria and Kelowna. "Victoria has always offered an attractive lifestyle for people at all life-stages whether they're students, young families or retirees. Luxury real estate within Victoria has now been 'discovered' by a much broader audience. Given current market conditions, we expect to see more buyers from both the Greater Vancouver and Alberta regions move into the market to access attractive, and relatively affordable, luxury housing."

Key Luxury Market Drivers

• Victoria's economy is projected to post its strongest gains since 2007 with GDP forecast to expand by a solid 2.3% this year according to the Conference Board of Canada, which ranked the market among the top ten fastest growing cities in Canada for 2016. An optimistic local economic outlook and unemployment rate that is below the national average of 7.1% at 6.2% as of April 2016 has fostered consumer confidence in the real estate market.

• Steeply escalating single family home pricing in Vancouver is driving demand for luxury options outside the Lower Mainland, including in Victoria, as buyers priced out of top-tier real estate in Vancouver seek alternatives. While benchmark pricing for detached homes was at $3,199,600 in Vancouver West and $1,345,400 in Vancouver East in April 2016, the benchmark price for a single family home in Victoria was $684,900. Attracted to the relative value and accessibility of Victoria luxury real estate, buyers from Vancouver were the most influential, non-local cohort within the market in the first five months of 2016.

• Interest in the Victoria luxury real estate market increased from Alberta buyers in the first five months of 2016. In particular, Victoria has seen notable interest from retired Calgary buyers looking to put down roots further west.

• Increased awareness of Victoria's top-tier market from mainland Chinese buyers, who have been significant influencers in Vancouver's luxury real estate market in recent years, has resulted in an increase in activity in Victoria. The primary, non-local driver of high-end Victoria real estate, however, are homebuyers from Vancouver.

About Sotheby's International Realty Canada

Combining the world's most prestigious real estate brand with local market knowledge and specialized marketing expertise, Sotheby's International Realty Canada is the leading real estate sales and marketing company for the country's most exceptional properties. With offices in over 30 residential and resort markets nationwide, our professional associates provide the highest caliber of real estate service, unrivaled local and international marketing solutions and a global affiliate sales network of over 845 offices in more than 63 countries to manage the real estate portfolios of discerning clients from around the world. For further information, visit www.sothebysrealty.ca.

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    Laura Mitchell
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