Homes with a median sales price of $925,000 outperformed all other property classes, according to data analyzed by Redfin.
Luxury homes in that quarter had a median sale price of $975,000, a 14.7 percent increase from the same period in 2020. The brokerage categorizes properties as either luxury, expensive, mid-priced, affordable or most affordable. By contrast, sales of mid-priced homes rose by only 5.9 percent while sales of affordable homes rose 7 percent.
Luxury home sales practically exploded in certain cities — 101.1 percent in Miami, 92.3 percent in San Jose and 82 percent in Oakland. The cities have proven popular for affluent buyers able to work from anywhere and looking to relocate during the pandemic.
“Luxury properties, even those in the $3 million range, are getting multiple offers and going for well over the asking prices,” Katy Polvorosa, a Redfin agent in Oakland, said in a statement. “That’s something we haven’t seen before, even though the Bay Area has many affluent residents. Everyone just wants more space and big backyards, whether it’s because they’re stuck at home during the pandemic or because they have a growing family.”
Across the country, an inventory shortage is driving prices up and prompting lightning-fast closings. While the number of luxury homes for sale is down 5.1 percent from last year, mid-priced homes (median sale price $272,000) and expensive homes (median sale price $429,00) are down an even greater 19.8 and 16.5 percent, respectively.
“With a huge shortage of affordable homes for sale, many non-luxury homeowners are hesitant to put their properties on the market because they’re worried they’ll have trouble finding their next house,” Redfin Chief Economist Daryl Fairweather said in a prepared statement. “This isn’t as big of an issue for luxury homeowners since there’s a relative abundance of high-end homes to choose from.”
While luxury sales are outperforming less expensive homes in sales, they tend to sit on the market longer — 61 days compared to 33 days for expensive homes and 25 days for mid-priced homes. Even so, that number is down consistently for all types of property.