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The approximate truth about Saskatoon’s luxury homes market

The Saskatoon real estate market saw another home sell above the $1-million mark this week. It’s kind of a big deal because it doesn’t happen very often though it’s certainly becoming more common. This particular sale brings the total number of Saskatoon homes that have sold this year, above the $1-million mark, to seven. That’s pretty impressive. In fact, it’s a new record number for this city. There hasn’t been another year during which seven Saskatoon homes have sold for more than $1-million and we’re not quite two-thirds of the way through the year.


It got me thinking about Saskatoon home price trends in recent years. Each year, at some point, a real estate agent or some other industry insider mentions to the media that sales of homes priced above $500,000 have skyrocketed. I’ve been one to point that out from time to time. On the surface, the trend does appear to be quite significant. Even as early a 2010 home sales priced at or above $500,000 had a total share of the market of just 4.8 percent. This year, it’s up to 8.1 percent, year-to-date. Wow!


So, I got to asking myself some questions on the topic. How much of that change can be accounted for by simple appreciation in the market? Are people actually buying more house or are they simply paying more for houses? I created a chart that contains info on three sets of Saskatoon housing data over the better part of the last five years. Here it is.


Click for a larger version of the chart.



The blue line represents the growing share of Saskatoon home sales, priced at or above the $500,000 mark. Ba-zing!


The red line represents the rather stable share of sales of homes that are 2,000 square feet or more in size and perhaps provides the most objective benchmark of change. It’s actually at its lowest point in five years at only 4.3 percent of the market, but it fluctuates between that and its high point of 4.7 percent. Meh!


Finally, data in the green line recognizes and accounts for increases to the price of a Saskatoon home over the past few years. A $500,000 home in 2012 is not the same home as it was in 2008. In fact, using the compounding effect of the increase in the median sale price of a Saskatoon home between 2008 and now, 2008’s half-million-dollar home may now cost as much as $590,000. Using that number, we see a pretty sharp decline in the share of the market that this particular home is claiming. Yikes!


In reality, higher-end homes haven’t appreciated completely in step with the market, so the true picture of the Saskatoon luxury homes market is likely better than the green line suggests. If the appreciation in this range is two-thirds of that seen in lower-priced homes it would put the green line at 4.7 percent in 2012, about where it was in 2008. Yawn!


Not that much has changed in Saskatoon’s luxury housing market other than the price of those homes.


I’m always happy to answer your Saskatoon real estate questions. All of my contact info is here. Please feel free to call or email me.


Norm Fisher

Royal LePage Vidorra

Norm Fisher, Author of the TeamFisher Saskatoon Real Estate Blog

About Norm

Licensed in 1993, Norm brings a wealth of experience to TeamFisher. He has worked in every imaginable capacity including sales agent, office manager, team leader, broker and now, broker/owner. Norm has written a weekly review of the Saskatoon real estate market for more than 650 consecutive weeks which may make him the most consistent industry blogger in the world.Less...

Licensed in 1993, Norm brings a wealth of experience to TeamFisher. He has worked in every imaginable capacity including sales agent, office manager, team leader, broker and now, broker/owner. Norm has written a weekly review of the Saskatoon real estate market for more than 650 consecutive weeks which may make him the most consistent industry blogger in the world.

Norm is known for his passion for technology and can most often be found exploring and experimenting with the next big thing in real estate marketing. He was the first Saskatoon real estate agent to promote a home online and has been an early adopter of new technologies ever since. “Everything about this business has changed over the past 20 years, and it will happen again in the next ten. An open mind and a curious attitude are all that’s needed to continue to find new ways to serve our clients by delivering a faster, smoother, worry-free transaction,” says Norm.

In his spare time, Norm enjoys Crossfit and cycling, some years accumulating over 2,000 kilometres on the road. He’s a strong supporter of the Royal LePage Shelter Foundation and enjoys raising funds by joining fun, fitness-related initiatives like the Grouse Grind for Shelter. In 2015, he trekked the Peruvian Andes to Machu Picchu. In 2017 he walked the southern highlands of Iceland across mountains, sand, snow, ice, lava fields and forest for seven days. Collectively those initiatives raised over a million dollars for Canadian women's shelters.
 

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