As demand for luxury homes is decreasing and continuing putting pressure on the value of these properties, is it still possible for see an escalation of wealth? In this month’s review we look at why buying a home is an escalator to wealth.
There seems to be a growing slowdown in the demand for luxury homes, which is causing people to question the value of home ownership. As demand decreases, this is putting pressure on the value of homes. For the 4th consecutive month, there has been a decline in the average sale price of detached homes throughout North America. These shifts are not dramatic, but with speculation of a slowing global economy, there will be even more stresses on the upper-tier market.
By understanding the niches of opportunity that exist within the market at any time. In this month’s report, we investigate some of the niches that are currently in favor with real estate investors.
According to the National Association of Realtors (NAR), the traditional market is seeing an increase in demand. Their recent report indicates that there are more interested buyers than active sellers, meaning that inventory may be increasing but there is still a shortage of supply. In most cases, the increase in demand ultimately drives home prices higher.
The decrease in demand for luxury homes coupled with the increase for traditional homes creates opportunity in the niche market between these two price points. Homeowners from the traditional market now have the ability to move into the home of their dreams with prices no longer outside their reach.
Choosing to live in this niche helps avoid the heavy taxes of the very high-end price point. But more importantly, it affords a lifestyle that offers luxury amenities, easy access to travel, and time to relax or partake in a favorite activity or adventure. As well as the opportunity of owning a second home.
Another niche experiencing growth are the luxury markets in locations outside of the major metropolitan areas such as Ocean City, Maryland.
Ocean City continues to a buyer’s market. Due to it’s proximity to metropolitan areas, such as Philadelphia, Washington, DC, and Baltimore, Ocean City provides the perfect location to enjoy the paradise of the beach.
Worcester County Luxury Market
Single-Family Home Luxury Market
- The Worcester County single-family luxury market is a Buyer’s Market with an 11% Sales Ratio.
- Homes sold for a median of 94.24% of list price in July 2019.
- The most active price band is $1,150,000-$1,249,999, where the sales ratio is 33%.
- The median luxury sales price for single-family homes has decreased to $992,500.
- The median days on market for July 2019 was 43 days, down from 86 in June 2019.
Attached Luxury Market
- The Worcester County attached luxury market is a Buyer’s Market with a 5% Sales Ratio.
- Homes sold for a median of 96.62% of list price in July 2019.
- The most active price band is $700,000-$749,999, where the sales ratio is 33%.
- The median luxury sales price for attached homes has increased to $600,000.
- The median days on market for July 2019 was 104 days, up from 51 in June 2019.
The full report can be found below. For more information about the July 2019 Luxury Market report and the services I can offer you and your luxury property, please give me a call at 410.430.1575 or email me at mnichols@LuxuryShoreLiving.com.