Luxury Market Report North America

Guide to luxury real estate market data and trends for North America.  Produced with data from The Institute for Luxury Home Marketing.

Luxury Home Market Report North America Luxury Home Market Review April 05 06 2020 b Hoey Team eXp Realty

This April 2020 report provides an in-depth look at the top residential markets across the United States and Canada. Within the individual markets, you will find established luxury benchmark prices and detailed survey of luxury active and sold properties designed to showcase current market status and recent trends. The national report illustrates a compilation of the top North American markets to review overall standards and trends.  Please ask us for a copy of the full 16 page report.

Lets begin with a quote from the President of the The Institute for Luxury Home Marketing on the status of the luxury home market during this COVID-19 time.

“‘The demand to stay at home hasn’t stopped the sale of properties, rather its seems to have given homeowners and realtors the time and opportunity to reassess; resulting in a better understanding of how to adjust, learn, and then make the appropriate changes during this fluid situation.’ states Diane Hartley, president of The Institute for Luxury Home Marketing.”

The Luxury Market Report is a monthly analysis provided by The Institute for Luxury Home Marketing.

Luxury benchmark prices are determined by The Institute.  Please visit our Luxury Home Market Page by Clicking Here to access all the different Florida Market Area Luxury Reports.

The active and sold data has been compiled by various sources, including local MLS boards, local tax records and Realtor.com. Data is deemed reliable to the best of our knowledge, but is not guaranteed.

The Institute for Luxury Home Marketing has analyzed a number of metrics — including sales prices, sales volumes, number of sales, sales-price-to-list-price ratios, days on market and price-per-square-foot – to provide you a comprehensive North American Luxury Market report.

Additionally, we have further examined all of the individual luxury markets to provide both an overview and an in-depth analysis - including, where data is sufficient, a breakdown by luxury single-family homes and luxury attached homes (Condos).

It is our intention to include additional luxury markets on a continual basis. If your market is not featured, please contact us so we can implement the necessary qualification process. More in-depth reports on the luxury communities in your market are available as well just let us know, call or text 239-360-5527.

Looking through this report, you will notice three distinct market statuses, Buyer's Market, Seller's Market, and Balanced Market.

A Buyer's Market indicates that buyers have greater control over the price point. This market type is demonstrated by a substantial number of homes on the market and few sales, suggesting demand for residential properties is slow for that market and/or price point.

By contrast, a Seller's Market gives sellers greater control over the price point. Typically, this means there are few homes on the market and a generous demand, causing competition between buyers who ultimately drive sales prices higher.

Balanced Market indicates that neither the buyers nor the sellers control the price point at which that property will sell and that there is neither a glut nor a lack of inventory. Typically, this type of market sees a stabilization of both the list and sold price, the length of time the property is on the market as well as the expectancy amongst homeowners in their respective communities – so long as their home is priced in accordance with the current market value.

REPORT GLOSSARY

REMAINING INVENTORY: The total number of homes available at the close of a month.

DAYS ON MARKET: Measures the number of days a home is available on the market before a purchase offer is accepted.

LUXURY BENCHMARK PRICE: The price point that marks the transition from traditional homes to luxury homes.

NEW LISTINGS: The number of homes that entered the market during the current month.

PRICE PER SQUARE FOOT: Measures the dollar amount of the home's price for an individual square foot.

SALES RATIO: Sales Ratio defines market speed and determines whether the market currently favors buyers or sellers. Buyer's Market = up to 14%; Balanced Market = 15 to 20%; Seller's

Market = 21% plus. If >100%, sales from previous month exceed current inventory.

SP/LP RATIO: The Sales Price/List Price Ratio compares the value of the sold price to the value of the list price.

The Institute for Luxury Home Marketing recognizes the ongoing coronavirus pandemic and its effects both on human life and the economy as these impacts are being felt by every single individual.

Traditionally at this time, we would offer an in-depth report on the status of the luxury real estate market for the first quarter of the year and reviewing whether forecasts made at the end of 2019 and beginning of 2020 are being realized.

Indeed, in looking at the figures during the first quarter of 2020, the luxury market overall reported a strong start to the year. Even though the World Health Organization announced the global pandemic on March 11th, properties were still being bought and sold at an increasing rate until the end of March, which typified a normal growth at the start of the spring market.

According to Realtor.com’s Chief Economist Danielle Hale, who stated during her recent interview with RIS Media, “A low interest rate environment combined with flourishing economy and recordsetting stock markets pushed luxury sales into the double digits for the first time as 2019 came to an end.”

By the end of 2019, million-dollar sales had increased by 11.4 percent year-over-year and the entry point for luxury increased 2.1 percent to $1.27 million. Hale recognized that this trend continued well in to March 2020, as buyers took advantage of the opportunity to lock in low rate mortgages, as well as high levels of luxury inventory that gave them plenty of options.

At the end of the 1st Quarter 2020, the single-family luxury market numbers were trending upwards with median sale price increasing from $1.315 million at the close of December to $1.32 million in March. Equally, the sales price to list price ratio trended from 96.8% to 97.6% and average days on market dropped from 60 to 39 days.

In the attached market, the luxury market was also seeing growth with median sales price increasing from $912,500 in December to $923,500 in March. The sales price to list price ratio trended from 97.9% to 98.6% and average days on market dropped slightly from 44 to 42.

Since the last week of March, all indicators now show that the real estate market has started slowed down. Experts are predicting a 30-35% drop in inventory for April, compared to last year.

However, currently there has been little signs of panic selling and property prices are remaining fairly steady.

“The demand to stay at home hasn’t stopped the sale of properties, rather its seems to have given homeowners and realtors the time and opportunity to reassess; resulting in a better understanding of how to adjust, learn, and then make the appropriate changes during this fluid situation.” states Diane Hartley, president of The Institute for Luxury Home Marketing.

The Institute’s members report that they are seeing reactions across the board; from those determined to move forward to others removing themselves from the real estate market entirely.

Some who have been caught in mid-transaction are agreeing to put their contracts on hold or moving their completion date, which helps both the buyers and sellers complete the deal without the requirement of having to move home at this critical time.

In a recent interview with RIS Media, Hartley stated that “The biggest thing we are telling our members to do is to continue to be a source of information and stability for both their clients and their community. Use this time to deepen relationships and create new ones. This is a time to give as much as possible!”

Members are also reporting that during this transition period they are learning how to pivot their business by using more technology and virtual methods. Tech savvy homeowners and buyers are able to adapt fairly quickly while others are having to learn the process.

Technology is allowing Realtors, lenders, and buyers to move forward, from digital mortgage approvals to being able to sign contracts and even visit the property virtually — a decade ago this situation would have shut down the housing market completely. One clear difference is that most contracts are now including a coronavirus addendum to allow greater flexibility in their timelines and contingencies.

Realtors are upgrading their technology to provide 3D tours, videos, and live streaming for promotional purposes as well as touring the property. Video tours with music or featuring the Realtor explaining the aspects of the home are proving highly popular and replacing open houses.

Potential buyers are having their Realtor walk through house with a video conference program so that they can ask specific questions and look at all the aspects of the home. Obviously both the sellers and the Realtors involved are expected to take the necessary precautions and follow recommended hygiene etiquette. This method is also being used by home inspectors.

In some cases, existing technology with little previous visibility is now coming into the spotlight. 

In one example, software to allow appraisers to perform virtual inspections has been available for some time and even includes fraud protection. With recent shelter in place orders and cooperation with all parties, these services can continue to be completed and help transactions move forward.

One area that remains challenging is the closing of the real estate contract. It seems that remote online notarization varies in accordance with local rules and regulations. In some locations, digital closings are already approved and part of their daily methodology, in others in person signing and witnessing is mandatory. As the pandemic continues, we will surely see changes and a move to online approval the longer we maintain social distancing practices.

One thing that can almost be guaranteed is that the ingenuity of Realtors and associated service providers, who will surely only be limited by technology’s current abilities and local legislation. All indications are that this situation will have a lasting impact on how real estate transactions will be conducted in the future.

SINGLE-FAMILY HOMES MARKET SUMMARY ~ MARCH 2020

• Official Market Type: Balanced Market with a 19.58% Sales Ratio.1

• Homes are selling for an average of 97.58% of list price.

• The median luxury threshold2 price is $942,500, and the median luxury home sales price is $1,320,000.

• Markets with the Highest Median Sales Price: Vail ($3,982,500), Santa Barbara ($3,450,000), LA - Beach Cities ($3,443,444), and Vancouver ($3,235,000).

• Markets with the Highest Sales Ratio: San Francisco (82%), East Bay (71%), Seattle (71%), and Silicon Valley (57%).

ATTACHED HOMES MARKET SUMMARY (Condos) MARCH 2020

• Official Market Type: Balanced Market with a 15.39% Sales Ratio.1

• Attached homes are selling for an average of 98.60% of list price.

• The median luxury threshold2 price is $685,000, and the median attached luxury sale price is $923,500.

• Markets with the Highest Median Sales Price: Vail ($2,900,000), San Francisco ($2,250,000), Naples ($2,200,000), and Park City ($2,102,500).

• Markets with the Highest Sales Ratio: Silicon Valley (109%), GTA-Durham (107%), East Bay (106%), and Arlington and Alexandria (82%).

Article content from The Institute for Luxury Home Marketing Newsletter and from other sources including Hoey Team ☘ eXp

Hoey Team  eXp Realty COVID-19 Resource Page

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Hope Everyone Remains Safe; we are all in this together; and we trust that we will get through this Coronavirus COVID-19 pandemic more united, as one, with as little loss as possible. 

Please let Kim or Barry know if we can do anything to help anyone in need here in Southwest Florida, weither it is for you or for a loved one, and we are able to help in a responsible social distncing way, we will certainly do what we can to help.

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We hope that you find the information useful.  If you have any questions, please do not hesitate to contact Barry or Kim with the Hoey Team  brokered by eXp Realty

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