The data doesn’t lie.
It seemed to me that the luxury home market was hotter than the previous few years but Crain’s refuted my non-data “theory” with real data.
200 homes priced over $1.5 million sold in the first half of the year in the Chicagoland area which was the same number as sold in 2011 and was just 3 more than sold in 2010 (which saw 197 sales.) There are 1019 homes currently listed above $1.5 million in the Chicagoland area.
The peak number of sales was, not surprisingly, 2006 when 381 homes sold over $1.5 million.
The low point was in 2009, when just 168 homes sold.
[It appears this article is referring ONLY to single family homes- and NOT condos.]
Traditionally, luxury homes have been the “first market to fall and the first market to pick up” through economic cycles, said Jim Kinney, vice-president of luxury home sales at Baird & Warner. Though high-end home sales are up 19 percent from the bottom in 2009, they have held steady this year while the broader market has perked up.
“There’s obviously fewer and fewer people trading up when you get to the top of the pyramid,” Mr. Kinney said. “Instead of a pyramid, it’s looking like a straw.”
Uncertainty over the upcoming presidential election has kept some luxury buyers on the sidelines this year, Mr. Kinney said, and the euro crisis and sluggish U.S. economy also may be a concern among some would-be buyers. And many buyers still face the same old problem: They can’t buy a new, more expensive home until they sell their old one.
The “best” markets?
- Lincoln Park – 33 sales
- Winnetka- 33 sales
- Hinsdale- 21 sales
Those markets with the highest inventory based on prior sales?
- Northbrook was #1 with 102 months of inventory and 19 properties listed
- Clio’s Oak Brook has 48 months of inventory with 36 properties listed
- Hinsdale, another Clio favorite, has 30 months of inventory with 80 properties on the market
Northbrook tries to explain its #1 ranking.
Based on sales activity, Northbrook is the weakest high-end market, with 102 months of supply — more than eight years. Just 19 homes in the north suburb are on the market for $1.5 million or more, but only two have sold thus far this year.
The listing agent on one of those sales, Shaun Raugstad of Coldwell Banker Residential Brokerage, said the statistics are likely skewed because of Northbrook’s smaller market.
Yet he also admits a buyer-friendly climate and that “people tend to flock a little more east” than Northbrook.
“People know exactly what they’re looking for, and in this market they want to find their dream home,” he said.
What are luxury sales really like in the city if you add in condos?
What happens to Lincoln Park’s luxury “inventory” when Lincoln Park 2520 (aka 2550 N. Lakeview) and its hundreds of condos is added to the equation?
What does it mean for the overall market if luxury sales are NOT picking up?
Luxury sales lag as housing market picks up [Crain’s Chicago Business, David Lee Matthews, July 24, 2012]