Luxury home prices rose 5.2 percent year-over-year to an average of $1.9 million in the second quarter of 2018, according to a report from the real estate brokerage Redfin.
According to the report, luxury homes went under contract during the second quarter after an average of 65 days on market, six fewer days than one year ago, and the fastest pace since Redfin began tracking the metric in the first quarter of 2009.
“Demand for luxury homes in the U.S. has strengthened this year because stock market gains and tax reform put more money in the pockets of the wealthy,” Redfin Senior Economist Sheharyar Bokhari said in a release.
“Yet the inventory shortage is ongoing even among multi-million-dollar homes,” Bokhari added. “As a result, we are seeing luxury homes sell in record time. The good news is that inventory declined at a slower rate last quarter, which has alleviated some of the upward pressure on prices, resulting in slightly lower price growth in the luxury market last quarter.”
Redfin said luxury homes sold the fastest in Oakland, Calif. (17 days), followed by San Jose, Calif. (19); San Francisco (29); Seattle (43); and Washington, D.C. (44).
The largest increases in luxury home prices in the second quarter were in West Palm Beach, Fla. (85 percent increase); Boynton Beach, Fla. (59.1 percent); Henderson, Nev. (27.7 percent); and Seattle (27.5 percent).