Vancouver luxury home demand soaring: report

The demand for luxury homes in Vancouver soared in the first half of the year as the number of residences with million-dollar price tags rose by nearly 50 per cent from the same time last year, according to a new study by Sotheby's International Realty.

The biannual report released on Thursdayshows thatluxury real estate is selling briskly inToronto and Vancouver, while million-dollar home salesin Calgary have sliddue to dropping oil prices.

In Vancouver, 2,465 homes sold for more than $1 millionor higher inthe first half of 2015, which is a 48 per cent increase from the previous year.

VancouverSothebybrokerPollyCordwellsaysa million-dollar price tag on aVancouver home is no longer considered luxury digs.

The starting point for a Vancouver luxury home is$3.5 millionthe highest in Canadaand demand for these homes is high. So far this year, 219 of these properties have sold, up 71 per cent from last year, theSotheby'sreport said.

"If you look online,$2 million is getting you a teardownin most places in Vancouver,"Cordwellsaid. "It's not considered luxury here."

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Flipping properties becoming more popular

Cordwellsays more buyers are asking aboutflipping properties on deals that haven't yet closed.Shedidn't have exact figures but she said anecdotally more buyers have inquired about the practice in the past year.

The highdemand for properties has also fuelled a rise in so-called contract assignments where a buyerwho hasmade an offeron a homebut hasnot yet closed on the deal hands over thecontractrights to another buyerfor a profit.

"The market really had an uptick this year,"Cordwell said. "People who bought maybe in November or December of last year and then didn't have a closing for a few months suddenly saw this spring ... the market is really going crazy. 'MaybeI could re-sell this and make some money.'"

"We've just had a lot more people asking about it. It's definitely gained a lot more popularity."

'There is no bubble here'

The report cited low interest rates, rising foreign demand and high consumer confidence for the increase in high-end home sales.

"I think that people are starting to realize that there is nobubble here," Cordwell said. "Plus there are just so many people buying and I think that the more people see that, the more confidence there is in the market.

"I mean the sales are going crazy. When other people see that they get caught up in it too."