Due to the booming tech sector and strong foreign interest, northern California continues to lead in the luxury price growth across the U.S., according to a Realtor.com report released Thursday.
In May, 19 out of the 91 major U.S. markets Realtor.com tracks posted double-digit price growth in the luxury segment, which is defined as the top 5% of the sales in each market.
Six markets in northern California made the list: Santa Clara (14%), Santa Cruz (13%), San Mateo (13%), Sonoma (10%), San Luis Obispo (10%) and Sacramento (10%). In addition, Marin was ranked 20th with a price growth of 9.7%.
“In spite of a slow down in price growth at the mid-market in the Bay Area, our luxury index indicates that the top 5% of homes have seen prices grow and even accelerate in some areas,” said Danielle Hale, chief economist for Realtor.com. “The Bay Area remains an attractive place to buy real estate for those who can afford it.”
Except Sacramento, the luxury entry threshold for all the other six Northern California markets in Realtor.com Top 20 fastest-growing list surpassed the $1 million mark in May.
“The strong economy is bolstering demand for luxury homes,” Ms. Hale said. “They are selling fast, and demand for these homes has pushed the entry-level price point to more than $1 million in half (49 out of 91) of the markets studied.”
Across the 91 major markets, $1-million-plus sales rose 13% year-over-year in May.
he fastest-growing market in May was Sarasota, Florida, with the sales price up 21.2% annually. Half of luxury homes in Sarasota sold within 157 days on the market, 21% faster than the same month last year.
Queens, New York, was the second fast-growing market. Luxury sales price in the county rose 16% in May.
In Colorado, Boulder (14%), Douglas (11%) and Denver (11%) all saw double-digit growth in May. Luxury homes in Boulder and Denver typically sell in under 95 days, putting them among the faster-selling luxury markets in the country.