Tale of two cities: Luxury prices soar in Oakland, plummet in San Francisco
By Ron Trujillo / firstname.lastname@example.org
High-end home prices increased 4.9% during the third quarter, as declining inventory and increasing demand lifted the market for million-dollar properties.
But California, often one of the priciest and strongest luxury markets, was largely overshadowed by hefty gains in Colorado and Florida communities, according to industry tracker Redfin.
Only Oakland cracked the top 10 cities with the largest gains during the July-September period. The Bay Area city’s luxury home price reached $2.27 million, a 15.6% increase compared to a year ago – and more than double the 7.3% gain for the overall housing market in Oakland. Longmont, Colo., had the largest year-over-year increase at 34.7%, followed by Fort Lauderdale, Fla., at 28.7%.
In fact, two of the four biggest losers in the luxury market were in California: San Francisco’s high-end home prices plummeted 14.7%, the second-largest decline in the nation, while Oceanside plunged 9.9%, the fourth-worst performance. Delray Beach, Fla., had the largest drop at 26.9%.
Redfin considers the luxury market the top 5% most expensive sales in a specific city, such as Los Angeles and San Francisco. The other 95% of homes comprise the so-called “rest of the market” category.
“There is still strong buyer demand for high-end homes,” says Redfin chief economist Nela Richardson. “Despite declining inventory, luxury sales soared in the third quarter. Sales of homes priced at or above $1 million were up 11% from a year ago, while sales of homes priced at or above $5 million were up almost as much at 10%.”
Of course, as home prices climb, more homes join the $1 million and $5 million club. Regardless, even top-of-the-market homebuyers are facing a housing shortage, as days on the market falls to 70 , four fewer than third-quarter 2016 – and only 17 days more than the overall market.
Feature photo of Menlo Park home by Krista Abel/Shutterstock. Santa Monica home photo by Divanov/Shutterstock.