While the rest of the housing market seems to be stuck in the mud amid rising home prices that are alienating home buyers and a lagging inventory that just isn’t giving buyers enough options for purchase, conditions on the luxury market are looking particularly peachy as sales have actually increased this year from last. In addition to its current growth, it looks as though conditions will continue to improve, giving luxury home buyers and sellers a great market to work within.
According to real estate data firm CoreLogic DataQuick, homes in the upper echelons of the price spectrum in California are faring particularly well this year. Sales of homes priced from $1 million or more hit a seven-year high, while sales of $2 million homes have hit an all-time high for any second quarter ever recorded in the state. These records represent a 9.1 percent increase in sales of homes with seven-figure price tags over the last year, which is a stark difference from lower price brackets of the market that saw a decrease in sales year-over-year.
In all, 12,826 homes that are priced for more than $1 million sold in the second quarter.
Helping to drive these sales for high-end home buyers is most likely a carry-over from a strong stock market, which is helping to put more money into the pockets of the wealthy. In addition to having a higher capital to either pay in full or put a down payment on a home, luxury home buyers are also reaping the benefits of low interest rates on home loans.
“It’s always fascinating to watch this part of the real estate market,” CoreLogic analyst Andrew LePage said to the Los Angeles Times. “It behaves differently, responds to its own set of criteria. These buyers, especially those in the multimillion-dollar market, are less likely to agonize over credit scores, income and job security, down payments and mortgage interest rates.”
Southern California Post Big Luxury Home Sales Gains
On a more local level, the region of Southern California has posted big increases in luxury home sales. With help from the sparked interests of international investors, luxury home sales in the region edged up by 11.6 percent over the last year.
Demand brought on by foreign investors has also helped push home values higher and into what is luxury territory across the state. Home price increases have been big news throughout the country, but have been most closely watched in parts of California such as San Francisco and Los Angeles. Many homes that were stuck at the $900,000 mark have been pushed into million dollar ranges.
This may mean that the million-dollar, Southern California home may not be as rarefied as it once was, but this is working to make properties on the highest end of the spectrum even more valuable and exclusive to the most affluent buyers.
If you are interested in checking out some of the hot luxury real estate in Laguna Beach, please allow one of our property experts to help you find the home of your dreams. Call us today!