The market for luxury homes, like this one in Vancouver, is expected to stay strong despite fewer sales. (Point2Point Homes)

Luxury buyers in Greater Vancouver stray from houses, aim for condos: report

Prices for condos are expected to continue to rise

Sales are down, but prices remain high for luxury homes in the Greater Vancouver area, according to a Royal LePage report released Thursday.

The median price of a luxury detached home in the region rose by 5.2 per cent to $5.8 million in the first quarter, compared to the same time last year, while luxury condos increased by seven per cent to $2.5 million.

Sales of detached luxury homes dropped by nearly 40 per cent, however, while luxury condos saw a 27-per-cent drop.

READ MORE: Growth in Lower Mainland home prices slows in April

Prices are expected to slow down for the rest of 2018, Royal LePage CEO Phil Soper said, as the effects of the new mortgage “stress test” and provincial policies like the speculation tax continue to be felt.

The stress test means that all borrowers must now qualify for a mortgage based on either the five-year benchmark rate or their lender’s actual rate plus two per cent, whichever is higher. The change will apply to all mortgages, new or renewed, even if the down payment exceeds 20 per cent.

The speculation tax, which comes into effect this fall, will hit all homeowners in B.C.’s urban areas who don’t pay income tax in the province. It will start at 0.5 per cent of the property value before rising to two per cent, and excludes rural cottages and cabins.

“The price appreciation that we are witnessing in Greater Vancouver’s luxury market this spring is largely a result of momentum being carried over from 2017,” said Soper.

“Price appreciation in the luxury market is expected to decline in 2018, while sales volumes are expected to continue to be lower than recent norms.”

READ MORE: David Eby cancels town hall due to ‘safety concerns’ after school tax protest planned

By 2019, detached luxury homes are expected to drop in value by three per cent, while luxury condos are expected to rise by two per cent.

“Younger luxury buyers prefer condos for their affordability and little upkeep, while baby boomers increasingly prefer them as a downsizing option,” Royal LePage Sussex sales representative Brock Smeaton said.

“Of course, this demand also catches the eye of investors who see rental opportunities.”


@katslepian

katya.slepian@bpdigital.ca

Like us on Facebook and follow us on Twitter.

Just Posted

VIDEO: Burn scars now a ‘badge of honour’

White Rock woman shares story of survival after a terrible accident in 1978

Langley Demonstration Garden: Bee there or bee square

The opening day of the season for the public garden featured a bee theme.

Langley boxer’s represent at ‘Turmoil on 200th’

Langley Event Centre hosts first ever pro boxing show

VIDEO: Walnut Grove Secondary students host Gator Music Festival

All proceeds will benefit children with special needs from Langley

Letter: Extend large item garbage collection to Langley townhouses

A townhouse resident would like the same pick up option that’s given to single family dwellings.

VIDEO: Pro-pipeline rally hosted by Langley family

The new organization Suits and Boots held the rally to support the resource sector.

Giant beer tanks arrive in new B.C. home city

Molson Coors tanks finish river journey and move to overland trip in Chilliwack

B.C.’s Ryan Craig, Vegas Golden Knights chase history

Local product behind bench for expansion team’s incredible championship run

CP rail workers give strike notice

Employees could walk out as early as Tuesday at 7 p.m. PT

Vote points to abortion being legalized in Ireland

Voters asked whether to keep or repeal Eighth Amendment to Roman Catholic Ireland’s Constitution

COLUMN: Women’s breasts really aren’t that big a deal

A follow on some Princeton, B.C., students gained considerable exposure when they dropped their bras

Canadian soccer officials talk up World Cup bid at Champions League final

Current bid calls for 2026 World Cup games to be staged in the U.S., Canada and Mexico

B.C.’s devastating 2017 wildfire season revisited in new book

British Columbia Burning written by CBC journalist Bethany Lindsay

Most Read