There’s talk of the real estate market being in the midst of a prosperous recovery across the nation, and California’s resurgence is not something to ignore. The coastal state has always been a highly desirable place to put down roots, especially for those looking at luxury real estate. A new market tracker report found that the market the Golden State is so famed for came roaring back in 2013.
The report from DataQuick found that the number of homes costing more than $1 million skyrocketed in sales by 45 percent over 2012, to the highest level since 2007. High-end buyers snatched up 39,175 homes in 2013 compared with 26,993 the year prior. To add to the success of the local market, a record number of buyers — 10,602 to be exact — purchased with cash in hand. At the same time, the number of homes that sold for more than $2 million set state, Southern California and L.A. County records.
These statistics were boosted by the massive sale of a $74.5 million estate in Malibu, which featured 9.5 acres, a 15,000-square-foot main house, two guesthouses, a gym, eight bedrooms and 14 bathrooms. The property broke records in the area and was the most expensive property sold in the U.S. at the time.
“There is a lot of wealth out there, and people do need someplace to park it. With the increase in California home prices, I think we’ll see more people moving back into residential real estate,” Kimberly Ritter Martinez, an economist at the Kyser Center for Economic Research in Los Angeles, said.
Effects of the Luxury Market Boom
The boom in the luxury market has helped to boost the median home value in the state, as well as prove that the local economy is well on its way back to stability. Seven of the state’s top 10 most expensive markets were in Southern California, including Beverly Hills, Brentwood and Pacific Palisades.
“The luxury home market is unique, always has been,” John Walsh, DataQuick president, said in a statement following the release of the report. “It responds to its own set of economic factors. Things like job growth, mortgage interest rates and migration patterns do not play the same role as IPOs (and) stock-market performance.”
As more people are willing to shell out money for high-end properties, experts believe that others will follow. The bandwagon effect will play a role in the future of the luxury housing market in Southern California and the pent up demand of home owners just waiting to jump in will fuel the spring buying season.
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(all data current as of 10/22/2017)
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