The market for luxury homes rebounded in strength last month, rapidly outpacing other market segments in both listing views and price growth, according to the latest Luxury Housing Report from realtor.com.
The report found that second home markets in particular were seeing a lot of attention from buyers, as they shift their attention away from dense, urban metros to smaller, less populated areas.
“Unlike prior downturns, the luxury market is leading the recovery,” said Danielle Hale, realtor.com’s chief economist. “Stay at home orders and social distancing have put a new value on the extra space. We’re seeing this in the luxury market as well, which could mean there is renewed interest from high-end buyers to find a second home that is within driving distance from their primary residence.”
Three notable second-home markets were ranked in the top five overall luxury home markets in May: Suffolk County, New York, which is home to The Hamptons; Palm Springs in Riverside County, California; and Greenwich in Fairfield County, Connecticut. Those markets saw the largest jump in listing views in May, according to realtor.com’s data, rising by 56% in The Hamptons, 28% in Palm Springs and 24% in Greenwich, compared to January 2020, just before the coronavirus pandemic.
In total, online views for luxury homes – those valued at a million dollars or more – rose by 7.3% compared to one year ago, outpacing the 6.2% growth the sector saw pre-pandemic. In addition, home price growth in the luxury segment is outpacing the rest of the market, realtor.com’s report noted,
Housing shortages remain an obstacle that could stymie growth in the sector moving forward, however. Inventories of million-dollar listings fell 15.6% annually in May. However, luxury sellers are showing some signs of reemerging on the market with new listings, the report noted.