The Market for Luxury Homes Gaining Speed

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The housing market is growing more slowly than expected with sales dropping for a 5th consecutive month in March 2014. However, the luxury home market niche does not seem to follow strictly the general trend. It actually experienced significant growth during the first quarter of 2014. This trend is likely to remain.

The sales of luxury homes, with values between $500,000 and $750,000, increased by 15% in January 2014 compared to the same month of 2013. At the same time, the sales of home valued between $100,000 and $250,000 dropped by 6% on an annual basis during the same month. This trend remained during February and March 2014. One of the strongest performing metro areas was Denver where the number of luxury homes sold during March 2014 was 18.3% higher compared to March 2013.

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There is other significant statistical data confirming the speedy revival of the luxury housing market. The sales of luxury homes valued at $1 million or higher increased by 62% in San Francisco and by 40% in Los Angeles from the final quarter of 2012 to the final quarter of 2013. The time during which the luxury properties stay the market is also much shorter. The Denver data for January 2014 reveals that luxury homes with values higher than $500,000 stayed on the market for a 12% shorter period compared to the same month of 2013.

The inventory is the luxury home market is also growing. It is increasing at a much higher speed compared to the inventory in the housing market as a whole. The inventory in many West Coast markets which have primarily luxury properties increased significantly in March 2013. The increase in Ventura, California, was the highest. It marked 13.8% on an annual basis.

The growth in the luxury home market is expected to remain fairly high and steady as well. One of the major factors for this is the affordability of jumbo loans which currently have rates around 4.1%.

Christian

Christian

Christian Calvin mortgage Christian is a contributing writer for Mortgage.info. He is a graduate from the University of Tennessee with a degree in Communications and a concentration in Broadcasting. Christian has served as vice-president for a privately-held company for more than 20 years. Additionally, he has also applied his writing and business knowledge to various websites with a focus on business and sports news . . . both of which are passions. Christian enjoys playing golf and spending time with his family and friends.

Contact: christian@mortgage.info
Christian

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