The average sale price for luxury homes reached $1.63 million in the fourth quarter of 2019, according to new data from Redfin
. This marked a 1.6 percent year-over-year increase and the largest gain since the third quarter of 2018.
Sales of homes priced at or above $1.5 million were up by 11.2 percent in the fourth quarter, marking the second-consecutive increase following three quarters of declines. In comparison, fourth quarter sales of homes priced below $1.5 million were up by only 6 percent from one year earlier. The major metro areas with the greatest year-over-year price increase for luxury housing were West Palm Beach, Fla. (up 104.5 percent to an average price of nearly $3 million), Charlotte, N.C. (up 21.2 percent to $1.26 million) and Tampa (up 20.6 percent to $1.30 million).
The typical luxury home sold in the fourth quarter took 60 days to go under contract, seven days longer than in the previous year. For non-luxury housing, the typical home went under contract in 43 days, one day faster than a year earlier.
"Demand for luxury is improving. That's showing up primarily in an increase in sales right now, but it's also putting some slight upward pressure on prices," said Redfin Chief Economist Daryl Fairweather. "We're ending the year in a much better position than we started, which is a good sign for 2020. I expect price growth to return to at least three percent to five percent by spring."