Have we hit a ceiling on escalating values?
What does the slow down in number of sales in the luxury market throughout North America mean? Trends I follow in networking with luxury agents across the country show the same dynamics we are experiencing on the Main Line.
While multiple offer bidding is still at play, there’s been a decrease in the frenzy since March. Whether it’s due to summer cycles, excitement over ability to vacation post-COVID, or a true reflection that buyers have hit a ceiling on how much they are willing to compromise in price and contingencies on their home purchase.
In today’s market, the demand for larger homes, estates, and mansions with land has been so great that properties that were previously less desirable are also selling quickly. In fact, many owners in tune to today’s trends have renovated their older and dated properties to capture this market opportunity.June Luxury Report – Institute for Luxury Home Marketing
According to the National Association of Realtors, the number of homes that sold for more than $1M rose by 81% in February 2021 compared to February 2020. In the Midwest, the number doubled in the same period. In the Northeast, volume increased by 98%. In the South, it was up by 94%. It is actually at this point that rhetoric and statistics begin to contradict each other.
While recent ‘sold’ data does report a record number of sales, increased prices, sales over asking price, and an all time low marketing time, there is actually still a good percentage of properties that have been active on the market for significant periods of time.
The great divergence between the rhetoric that all luxury properties are in high demand, isn’t because these homes are not wanted, it’s because, despite all the frenzied buying, the affluent are still savvy buyers. They will rarely buy a property they consider overpriced and the majority do not have the time, nor the interest, to purchase a home that is not to their standard of move-in ready.
For Center City and Main Line markets, we don’t yet have June data. Be sure to bookmark your Community on our website as the month’s market data is updated automatically as soon as it published. For more insights join me for my most recent market report #asksusanna:
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