Luxury home sales increased 2.9% year-over-year, while non-luxury sales rose 0.7%, as luxury inventory climbed 6.4% year-over-year, compared to a 9.5% increase in non-luxury inventory, posting their highest October levels in at least five years
It takes some real money to play in the upper echelons of the housing market, and it's getting more expensive seemingly by the day.
The latest tally from Redfin finds that luxury prices tripled that of non-luxury properties in October, 5.5% compared to 1.85%.
Redfin also found that sales in the top tier 一 defined as those selling in the top 5% of their respective markets 一 rose 2.9% versus just 0.7% in the lower 95%. Price growth at the high end even outpaced the middle of the market in October, a trend that has persisted for much of the past two years.
Both categories posted their largest increases in inventory in at least five years, but inventory of luxury homes climbed 6.4% year-over-year, compared to the 9.5% jump in non-luxury inventory.
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The difference in price growth between luxury and non-luxury homes underscores how differently wealthy buyers are behaving compared to typical move-up or first-time buyers.
Sheharyar Bokhari, senior economist, Redfin
“Luxury buyers are still able to move forward in ways that many typical buyers can’t right now, whether that’s because they’re paying in cash, benefiting from stock-market gains or taking out smaller loans,” said Redfin Senior Economist Sheharyar Bokhari.
“Those advantages make them less sensitive to high mortgage rates, which helps keep demand at the top of the market steadier. In contrast, a lot of middle-income buyers are holding off until monthly payments come down or their financial outlook improves.”
Even though luxury home sales rose 2.9%, they still hover near historic lows, Redfin found. At the same time, non-luxury sales also remain close to their lowest October levels over the past decade.
Jonathan Buch, agent, Redfin
“The luxury market has been a little more protected over the past year,” commented Jonathan Buch, a Redfin agent in West Palm Beach, Florida. “Affordability challenges have made it more difficult to sell homes priced under $800,000, but high-end properties are still moving.”
In terms of inventory, the number of luxury homes for sale are now at a five-year high, while the number of non-luxury houses is at its highest level since 2019. Houses in both segments are now taking six days longer to sell, but luxury homes are now taking 13 days longer to sell, 58 days as opposed to 45 days.
Lew Sichelman has been covering the housing and mortgage sectors for 52 years. His syndicated column appears in major newspapers throughout the country.
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