“Luxury Home Buyers Find Deep Discounts in Calgary Area”

Are buyers finding deep discounts in Calgary’s luxury home market? An article from CTV links falling sales to dramatic million dollar discounts, while ignoring that asking prices don’t tell the whole story.

Fact: a home can be listed at any price.   Whether or not it’s worth the asking price is a different matter altogether.

The two Priddis properties highlighted in the article had price tags of $2.9 and $3.9 million.  That they ending selling for less than half of asking doesn’t mean that prices have cratered by 50%.

Those two homes were built this year and have no previous sales history.  The sales-to-list-price ratio in this case is more a reflection of sellers being off the mark with their market evaluation and choosing an auction format listing in a slow market.

For a more comprehensive view, let’s look at the 31 luxury homes that have sold month-to-date in Calgary.   Thirteen of them had at least one previous MLS® sale:

Calgary luxury sale history

Calgary luxury sale history

Ignore the homes that had percentage increases of over 100%; those are infills, were substantially renovated, or last sold over a decade ago.

We’re left with three homes that sold for less than they were purchased by up to $177,000.   A home that was bought in June sold for $50,100 less this month.  A good chunk of change, but not million dollar losses.

On the other hand, there were a couple homes that previously sold nearly 2 years ago that saw gains of 8.2% and 9.1%, or $149,500 & $100,000.

Has the Calgary luxury market been impacted due to job losses and Alberta’s economy? No doubt, most notably in sales.   Have asking prices been reduced? Most assuredly.  But those shopping for high-end homes today can’t expect to find million dollar discounts relative to what the sellers paid for it.

Calgary luxury home sales, Oct 1-28, Y/Y comparison

Calgary luxury home sales, Oct 1-28, Y/Y comparison

3 responses to ““Luxury Home Buyers Find Deep Discounts in Calgary Area”

  1. Hi Mike
    Excellent post.
    Unfortunately some media outlets in the city don’t have reporters who understand real estate (and many other things they report on).
    Myke

  2. Mike
    I personally know of a home (acreage) that sold recently for slightly under what the buyer bought for 4 years ago ($1.2M) However, the owner put close to $200k in kitchen, basement, landscaping etc upgrades into the home. It just proves that looking at the numbers doesn’t tell the whole story. As an aside, the house was on the market almost 6 Mths. Beautiful home, slow market.

  3. Great entry, as always Mike.
    @ CJ, Its important to note that these type of acreage properties (in Springbank, Bearspaw, Priddis, or similar) are not liquid as the pool of potential purchasers is fairly limited when compared to something like a $500K home within city limits. These properties are therefore not representative of greater market trends and should not be selected as examples of such.

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