How Does A Toronto Luxury Home Appraisal Work?
How does a Toronto Luxury Home Appraisal Work?
I recently attended an appraisal course facilitated by Barry Lebow, a leading expert at Lebow Hicks Ltd in residential appraisals. The interesting part of the course was listening to Barry's insights on how the standard appraisal theory has changed over the years for appraising high-end homes. With the renovation boom and infill development trend in the last 15 years, appraisals for luxury homes no longer just go by the textbook concept of adjustments. Rejuvenated homes in the inner city with luxury upgrades are not just confined to exclusive neighbourhoods.
What areas in Toronto have Luxury housing?
If you are familiar with Toronto luxury neighbourhoods, some of the exclusive areas in Old Toronto are Lawrence Park, Rosedale, Forest Hill, The Bridle Path, Willowdale, York Mills, Hoggs Hollow, Moore Park, Yorkville, Annex and beyond the central core areas such as Angus Glen in Markham, Oakville, and along the Ontario Waterfront.
What is the definition of a "luxury" property?
The modern day definition of "luxury" is not only limited to size of the home, price and location, consumers also look for the quality of finishes and upgrades, as well as unique features that offers lifestyle amenities (indoor pool, wine cellar, indoor basketball court, nanny's quarter etc). Classifying a luxury property cannot be based on price alone. A $2 million dollar home could be a tear down in Forest Hill. The valuation can also vary greatly depending on your geographic location and between areas of the country. The type of luxury home can be of any type; a ranch, a mansion, a cottage, a condo, a penthouse, a townhouse or a custom home, modern infill versus traditional or historic home.
When appraising a stand alone custom home in an exclusive area, there are no set rules. Traditional appraisal theory does not apply to these homes. Each appraiser may come up with a different value for the home based on what they feel would hit the closest market value target. For extraordinary homes, it can sell in a day, or it can go through numerous price drops before it sells. How much the home is worth is based on the demand for this type of home in the market. The sale price is not always the market value! An appraisal is an opinion of market value.
James Stewart's Integral House in Rosedale went through six price drops before it finally sold.
Photo Courtesy of Globe and Mail
If you are wondering how much your luxury home is worth, contact me for a seller consultation for a Comparative Market Analysis.
Anne Lok is a Toronto Real Estate Broker with over 14 years of experience. She specializes in all aspect of residential real estate from modern houses, infill development, condos, lofts and rental properties in urban Toronto neighbourhoods. Anne aims to provide not only the best client service, but also a genuine authentic experience that will match your expectations. You can learn more about Anne at urburbia.ca or linkedin.