Redfin Reports 9% Jump Pushing Luxury Home Prices To All-Time High

U.S. housing is seeing a big difference between fancy digs and regular homes.

The price of luxury homes skyrocketed in the second quarter, hitting a record high of $1.18 million—an 8.8% jump from last year and the biggest leap in nearly two years, according to a recent report from Redfin.

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Regular homes are growing in price, too, although not nearly as fast. The median price for these homes hit a new high of $342,000, a 3.8% increase from last year.

Redfin defines luxury homes as the top 5% of a city’s most expensive houses, while regular homes are somewhere in the middle.

"The luxury market has withstood the havoc wreaked by high mortgage rates this year, thanks to an abundance of all-cash buyers," Redfin Senior Economist Sheharyar Bokhari said. "Now that sales are stabilizing and more homes are being listed for sale, it's unlikely that luxury prices will continue to grow at quite as high a rate."

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High-end homebuyers weren't as worried about rising interest rates as regular buyers. They often had more money from the stock market and their homes so they could pay cash. Nearly 44% of luxury homes sold this spring were all-cash purchases, which is up slightly from last year.

Luxury home sales held steady during the past quarter, only slightly increasing compared to last year. This marks the third consecutive quarter of sales growth for high-end homes. Meanwhile, sales of regular homes dropped 3.4% to the lowest level in a decade for this time of year.

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"There is still strong demand for well-priced, high-end properties, especially those which are presented beautifully and move-in ready," said Crystal Zschirnt, a Redfin Premier agent in Fort Worth, Texas, where luxury home sales were up 9.7% from the previous year. "We had a client recently list a property for $2.4 million that we ended up selling for $2.6 million. We are still seeing multiple offers in situations where a property is priced accurately, visually appealing, and doesn't need any work."

The housing market is still slower than before the pandemic, mainly because there aren't enough homes for sale. But luxury homes are doing better. While overall sales are down, luxury home sales have dropped less.

There are also more luxury homes on the market now than in the past few years, but still not as many as before the pandemic. And even better news for buyers: there are more new luxury homes available than regular homes.

10 Most Expensive U.S. Home Sales In Q2 2024

1.    Glenwood Springs, Colorado (Aspen): $77 million

2.    Glenwood Springs, Colorado (Aspen): $66.5 million

3.    Los Angeles: $62.8 million

4.    Miami (Miami Beach): $62.5 million

5.    Glenwood Springs, Colorado (Aspen): $59 million

6.    West Palm Beach, Florida (Palm Beach): $51.3 million

7.    West Palm Beach, Florida (Highland Beach): $50 million

8.    West Palm Beach, Florida (Palm Beach): $49.6 million

9.    Glenwood Springs, Colorado (Aspen): $48.8 million

10. Glenwood Springs, Colorado (Woody Creek): $46 million

Source: Redfin

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With more homes for sale, both luxury and regular houses are taking longer to sell. Luxury homes are now on the market for an average of 40 days, while regular homes take 31 days.

"We are seeing luxury homes sell within 30-45 days, but that's a lot longer than in 2022 when they were flying off the shelf," said Juan Castro, a Redfin Premier agent in Orlando, Florida, where inventory increased by 22.7% in the second quarter compared to the same time a year ago. "International buyers are still driving activity, but we have seen a slowdown in local buyers, as it's really hard to upsize to a luxury home with a 7% mortgage rate."

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