Sales of $100 million homes are set to double this year, driven by robust financial markets and expectations of interest rate cuts, signaling a revival in the ultra-luxury real estate sector, according to recent reports.
As of mid-July, six homes in the U.S. have already sold for over $100 million, according to data from Miller Samuel and Douglas Elliman. If this pace continues, it could more than double last year’s total and potentially surpass the record of nine homes sold for over $100 million in 2021.
While these nine-figure transactions represent a niche market, sales of homes priced at $50 million, $20 million, and even $10 million indicate a broader resurgence in the ultra-luxury real estate market, contrasting sharply with the national housing market still grappling with high mortgage rates and limited supply.
“This is a significant increase in sales velocity, which we aren’t seeing in the broader housing market,” noted Jonathan Miller, CEO of Miller Samuel, an appraisal and research firm.
Recent high-profile deals include a $115 million penthouse at Central Park Tower in Manhattan and a $135 million penthouse at Aman New York. In Florida, Palm Beach’s Tarpon Island sold for $150 million, and in California, Oakley founder James Jannard sold his Malibu mansion for $210 million, setting a state record.
The trend extends beyond the ultra-elite. Redfin reports that sales of homes priced at $5 million or more have risen by 13% year-over-year as of June.
The divergence between the ultra-luxury segment and the broader market reflects different economic forces at play. While the national market is constrained by mortgage rates, the ultra-wealthy are primarily influenced by stock market performance and liquidity, with many transactions being all-cash deals.
The luxury real estate market’s resilience is further bolstered by the ongoing “Great Wealth Transfer,” where millennial and Gen Z buyers, often with family trust funds, are driving demand, particularly in regions like South Florida.
This demand for larger, amenity-rich homes has pushed prices to unprecedented levels, with the price per square foot in South Florida’s luxury condo market increasing by 33% this year.
Despite the usual pause in high-end real estate activity ahead of presidential elections, the current market dynamics suggest that strong financial markets are outweighing election-related uncertainties for now.
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