With the recent sale of the $6-million home once owned by former NHL player Russ Courtnall, realtors in the niche luxury market have hope that their market is rebounding.
The 9,560 sq. ft. home at 3120 Humber Road is located in Victoria's tony Uplands neighbourhood and features a 1,500-bottle wine cellar, movie theatre, seven bedrooms, eight bathrooms and five fireplaces. When the Courtnalls hosted the Courtnall Classic golf tournament to raise money for mental health care, their guests at the house included celebrities Kiefer Sutherland, Wayne Gretzsky and Pamela Anderson.
The dining room, with a view over the water.
Both Russ and Geoff Courtnall have contributed to the renewed confidence in the luxury end of the Victoria market. A Victoria home once owned by former NHL player Geoff Courtnall sold previously in a private sale for $6.5 million, making it the highest price paid for a home in the Greater Victoria area so far this year.
"Everything seems to be selling better these last two months on the island here," says Scott Piercy, who opened the Sotheby's real estate office with fellow realtor James LeBlanc two years ago. "The change has come -- people are optimistic."
Because of its temperate climate and ocean views, Victoria is one of Canada's most desirable places to live, especially for retirees. Last year Sotheby's in Victoria sold 77 waterfront properties; this year, the luxury real estate agency sold 82.
"This year is our best year, without a doubt," says Mr. Piercy.
While international buyers continue as usual to scope the market, the purchasers have been mostly local, he adds.
In Vancouver, Sotheby's realtor Jamie MacDougall says sales have also picked up, despite the usually slow summer months.
"There has been a correction," says Mr. MacDougall. "Between October and February I'd say is when the correction happened, and since then there have been significant sales. Depending on where you are looking, whether it's Shaughnessy or Point Grey or waterfront in West Vancouver, I'd say [a correction of] 10 to 15 per cent."
The motivation to buy is a combination of low interest rates (a five-year fixed rate could be had for 3.69 per cent a month ago) and, compared to prices at the height of the market, there are deals to be had.
As an example of the type of deal out there, Mr. MacDougall says a West Vancouver house that was on the market for $5.8 million a year ago recently sold for $4.9 million. Geoff Courtnall's home may have sold for $6.5 million, but it was assessed at $7.2 million, making it a relative bargain.
Developers of high-end properties have had to adjust to the slowdown over the last year, but Victoria's multiple award-winning Abstract Developments has recently sold two of its luxury Edgecliffe Estate properties. The houses are priced between $2.5 million and $3.5 million and belong to the first new subdivision in the expensive seaside Oak Bay area in a decade, says Marketing director Todd MacKenzie. He says the company has evolved into building custom homes for clients rather than focusing on speculative properties, because there is less risk. With a custom home, typically the consumer has their own financing in place.
Abstract continues to develop high-end speculative properties, however. Its 16-unit West Coast style Terra Verde townhome development within walking distance of downtown Victoria is under construction, and there have been four pre-sales so far.
"There is some improvement in the $800,000 to $1.5 million market," says Mr. MacKenzie. "Why? Because rates are at an all-time low. And you probably have seen a 10 per cent correction in the prices of homes. People are starting to realize that it has hit bottom where we are."
Other than the correction to land prices, labour is also less costly than it was during the boom, making it possible for developers to adjust prices. And when a market corrects, it's always a better deal to move up, which is what savvy buyers already know. It's a matter of simple mathematics.
"When the market corrects 10 to 15 per cent, if you are moving up, you have won," says Mr. MacKenzie. "Because if you are selling a $1 million house and it's dropped to $900,000, and then you buy a $2 million house that you got for $1.8 million, you just made $100,000.
"For people moving up, this can be to their advantage."
