Our High End Has The Best Value

by Darrin DeRoches January 30 - February 5, 2014

The luxury home market in the Hamilton – Burlington market is hitting the top of the market. A report done by Remax shows a 31 percent increase in luxury homes, which brings us into the fourth spot in Canada. Sales were up a staggering 173 percent since 2009. The Vancouver, Calgary and Toronto markets are obviously above us but it is an amazing trend to see how we are not only killing it in the real estate market overall, but now also in luxury. A property to be considered luxury it is priced over $750,000 in our market. A couple of years ago if you listed a home over $500,000 dollars it would take almost double the average time to sell than a home below that mark.     I spoke with a client this week who was concerned about selling his property around $650,000 dollars, since he felt it may take a while to sell, but the data shows high end homes are selling. There was a home in Mississauga that sold this week for six million and it was a bargain. They had an auction this week with a home listed over 11 million dollars for years with no takers. The builder had to realize he may have over developed the property for the area. Everyone has their opinion, but the market spoke and it sold for six million dollars. Some say it is a bargain while others think that they paid too much, but in the end the market dictated the price and it sold. The developer may lose a little money on the deal but the comparable properties in the area are in the six to eight million dollar value so why would you think you can get over 11 million? This is high end real estate just down the road. Build the same property in our market and six million would be insane. The same materials and on a great piece of land it would never reach the six million dollar mark let alone the 11 million.     Hamilton’s high end market is the best value in all of Canada and it will only go up. There will be money to be made in the high end of the market if you know where to buy and what the market is looking for. Is it a huge garage, acres of land, pools, high end kitchens or all the above?     The developer in Mississauga may look like he just lost five million but the reality is that he probably broke even. Take that same investment of money and develop multiple high end properties in our market and he would have made up that “lost” five million.     So when you start to think about the Hamilton real estate market, you should realize that we are number one in the country and now we are entering the high end of the market too. This, plus the future of commercial investment, will take our market to heights we could never have imagined just a few years ago. V     Darrin DeRoches is a local real estate and mortgage broker. He can be reached to answer questions, comments or stories about real estate experiences through this weekly column at sold@uniquerealty.ca.