SANTA CLARA, Calif.,
June 25, 2020 /PRNewswire/
-- The U.S. luxury housing market defied gravity in May,
outpacing the rest of the market in price growth and views,
according to realtor.com®'s Luxury Housing Report
released today. Like the rest of the market, inventory remains the
biggest obstacle as home buyers shift their focus from dense urban
metros to smaller less populated areas.
"The COVID-19 pandemic has reinforced the resilience of the
housing market and unlike prior downturns, the luxury market is
leading the recovery," said realtor.com®'s Chief
Economist, Danielle Hale. "Stay at
home orders and social distancing have put a new value on the extra
space. We're seeing this in the luxury market as well, which could
mean there is renewed interest from high-end buyers to find a
second-home that is within driving distance from their primary
residence."
Luxury market at a glance
With just 25 of 94 luxury
markets tracked by realtor.com® showing listing price
growth increases since January, the COVID-19 pandemic has slowed
price growth in the luxury sector, which was up 15 percent at the
start of the year. This compares to 60 counties during the same
period a year ago.
Despite a slowing pace of price growth, the luxury listing price
entry point reached $2.97 million* in
May, up 0.5 percent from April and 6.1 percent year-over-year.
The luxury sector led the housing market's median price growth,
which was up 1.6 percent in May year-over-year.
Demand for luxury homes reached new highs in May. After falling
9.5 percent year-over-year in April, searches for million-dollar
homes grew 7.3 percent year-over-year, outpacing the 6.2 percent
growth prior to the COVID-19 pandemic.
Although inventory rebounded from historic declines in April,
million-dollar listings were still down 15.6 percent year-over-year
in May. In line with the overall housing market trends, luxury
sellers began coming back to the market with new listings for homes
priced above $1 million down just
15.1 percent year-over-year in May, compared to 57.8 percent in
April. Homes priced over $1 million
sold in 89 days in May, compared to 71 days a year earlier.
A second home appears to be in vogue for luxury
shoppers
Much like the suburbs are gaining favor with home
shoppers, second home markets are seeing increased interest from
luxury buyers. Suffolk County,
N.Y., home to The Hamptons, Palm
Springs in Riverside County,
Calif., and Greenwich in
Fairfield County, Conn.-- all
second home markets -- ranked among the top five markets with the
largest increase in listing view growth in May. Views of luxury
properties accelerated 56 percent in The Hamptons, 28 percent in
Palm Springs and 24 percent in
Greenwich compared to January
trends.
In contrast, Honolulu,
Key West, Fla. (Monroe County), Pebble Beach, Calif. (Monterey, Calif.) and ski towns in Eagle and
Summit counties in Colorado have all seen interest in luxury
homes wane since the start of the year.
NYC luxury market demand
spreads beyond city living
With New York becoming the epicenter of the
coronavirus in the U.S., luxury buyers focused their attention
beyond the dense urban setting of the five boroughs. The Hamptons
saw listing views increase 72 percent in May year-over-year, while
views of luxury homes in Union,
Bergen and Somerset counties in New Jersey increased by 40, 30 and 28
percent respectively during the same period. These counties
were seeing views per property grow between 10 to 21 percent prior
to the pandemic.
Despite the increased demand outside of the city's five
boroughs, Manhattan, Brooklyn, and Queens all saw luxury prices remain steady in
May compared to a year ago. This is actually an improvement over
pre-COVID conditions when the luxury prices in the boroughs were
declining slightly.
New York Metro Area Luxury Markets as Ranked By Views Per
Property
County
|
Million Dollar
Homes - Views
Per Property Y/Y
|
Luxury
Listing Price
(Top 5%)
|
Luxury Listing
Price Y/Y
|
Suffolk,
N.Y.
|
72%
|
5,950,000
|
8.2%
|
Union,
N.J.
|
40%
|
1,460,000
|
0.7%
|
Bergen,
N.J.
|
30%
|
2,539,000
|
6.3%
|
Somerset,
N.J.
|
28%
|
1,695,000
|
-5.6%
|
Ocean,
N.J.
|
19%
|
1,750,000
|
25.1%
|
Monmouth,
N.J.
|
18%
|
2,500,000
|
0.0%
|
New York,
N.Y.
|
18%
|
12,500,000
|
14.9%
|
Morris,
N.J.
|
15%
|
1,600,000
|
-3.6%
|
Westchester,
N.Y.
|
10%
|
3,395,000
|
0.0%
|
Kings,
N.Y.
|
10%
|
3,750,000
|
13.2%
|
Nassau,
N.Y.
|
2%
|
2,799,000
|
1.8%
|
Hudson,
N.J.
|
-7%
|
1,800,000
|
11.2%
|
Queens,
N.Y.
|
-22%
|
1,699,000
|
0.0%
|
*The luxury listing price entry point is defined as the
top 5 percent of homes listed.
EDITOR'S NOTE: The realtor.com economics team is
continually tracking the impact of the coronavirus pandemic on the
U.S. economy and housing market. The team's reports and analysis
are available here.
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visit realtor.com®.
Media Contact: Lexie Holbert,
lexie.puckett@move.com
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SOURCE realtor.com