Greater Victoria has been named one of the top-three hottest luxury real estate markets in the world in a report from Christie’s International Real Estate.
The capital region is a beneficiary of strong foreign interest in West Coast real estate, the report says. It notes sky-high prices in places such as Vancouver have led foreign buyers to look farther afield for real estate options, including Victoria.
However, numbers released by the Victoria Real Estate Board take issue with the assertion that foreign money is driving up local real estate prices.
The board says the vast majority of sales are local, with 72.5 per cent of buyers coming from Greater Victoria and another 7.5 per cent from the rest of the Island through the first quarter of this year. Between them, U.S. and Asian buyers made up less than two per cent of sales through the first quarter.
The Christie’s report ranked Auckland, New Zealand, first and Toronto second for hottest luxury market.
It suggests Vancouverites have used that city’s real estate boom to relocate to Victoria. The Victoria Real Estate Board says there may be some truth to that, with 8.2 per cent of buyers coming from the Lower Mainland, up from 7.4 per cent last year.
Victoria real estate agents say the buyers are either priced out of the Vancouver market or are hoping to cash out and use a windfall of home equity to buy in markets such as Victoria that remain relatively affordable.
A report from Royal LePage also suggests foreign money is having an effect on the Canadian luxury market. The Royal LePage Carriage Trade Luxury Properties Report says 66 per cent of its agents believe foreign buyer activity has increased in their region since 2005, and a quarter of agents believe 25 per cent or more of luxury properties in their area are purchased by foreign buyers.
“While the impact of foreign buying on Canada’s overall residential real estate market is small, we see it growing in importance in the luxury market,” said Phil Soper, chief executive at Royal LePage.
“Canada’s stable political and financial systems, along with a tradition of cultural tolerance and openness to immigration and diversity, make our country an ideal destination for wealthy international purchasers looking to invest in real property.”
Soper said a weak Canadian dollar also made buying here more attractive.
“Despite economic volatility, Canada’s luxury real estate market is healthy and active,” said Soper. “In times of uncertainty, we can see potential home sellers sitting on the sidelines, and as a result available inventory is constrained. That is not the case in today’s luxury market.”
The Royal LePage report says 83 per cent of real estate agents believe luxury property sales activity has increased over the last year in B.C. and 76 per cent believe that activity will continue to increase this year.
The Christie’s website lists 444 luxury homes and properties for sale in Canada, topped by a Muskoka, Ont. waterfront estate listed at $19.3 million and bottoming out at $774,174 in Sainte-Pacôme, Que.
The highest Victoria listing, in 19th place says “price on request” but is displayed at between a $6.1 million property in Toronto and a $5.3 million property in Muskoka. Victoria’s next most expensive listing is 3000 Rutland Rd. at $4.5 million.
Victoria has the second-lowest listing of the 444 properties — $792,754 for 5088 William Head Rd.
— with file from Katherine Dedyna
