The past few years has seen Vancouver’s luxury housing market in a slump. But the scene is changing according to a report recently released by Royal Le Page. Since the onset of the COVID pandemic in March, the median price of a luxury house in Vancouver has risen 8.9%.
Vancouver has always been a popular destination for off shore buyers of luxury properties, and it seems that COVID-19 is stimulating their demand for “safe havens”, especially seeing how effectively this province has dealt with combatting the pandemic.
The last 6 months has seen brisk activity in properties priced below $4,000,000, but it is only in the last few months that clear signs of improving demand and price appreciation for properties above $5,000,000 are becoming apparent. It seems that buyers are taking advantage of the lower price-per-square foot, enabling them to buy larger properties.
There is no doubt that interest rates will remain at their historic love levels for at least the next 12 months, coupled with a scarcity of supply, the pent up demand for luxury properties should continue well into 2021.
Two important facts should be noted:
1) While buyer confidence for luxury real estate properties is on the rise, buyers remain price sensitive.
2) There is not much evidence that foreign buyers are responsible for this surge in buying. It seems that a lot of demand is homegrown with local homeowners looking to upgrade their current homes amid changes in their work situation.
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