It’s official: The seller’s market has extended to all price ranges of the nation’s real estate sector, including luxury homes.
The luxury real estate category – defined generally as homes valued at more than $500,000 – reached the seller’s market threshold in June, according to the Institute for Luxury Home Marketing, which tracks the high-end market. The institute’s Market Action Index reached 30 for the first time since its creation in 2008. That’s an important milestone that means the luxury market has finally joined what’s going on in much of the country.
For the past two years, it’s been a seller’s market in most areas of the United States for the more-attainable low- to moderately-priced homes. Seller’s markets are characterized as having more buyers than homes for sale, which means that homes often sell quickly, with upward pressure on prices.
What’s behind the shift in the luxury market? Financing in the form of jumbo loans have been easier to get in recent months. Foreign buyers are out in force in many areas of the country. And many buyers who’ve been on the fence have realized that it’s a great time to buy move-up and vacation homes. The shift to a seller’s market in the luxury sector is good news for the market as a whole because it provides further evidence the housing recovery has really taken hold, hitting all cylinders of this very important economic engine.