Luxury Home Sales Collapse in New York

By Douglas A. McIntyre Published Dec 29, 10:30AM EST

Follow 24/7 Wall St. on Google

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

Luxury Home Sales Collapse in New York — © alarico / Getty Images

After a relentless rise in home prices that lasted from mid- 2020 until just two months ago, the real estate market has reset. The number of homes sold and their prices have begun a downward turn. No part of the market has been damaged more than luxury home sales. The area hit hardest by this trend is Nassau County in New York. Total luxury home sales in this market dropped 65.6% in the quarter ending on November 30.
[in-text-ad]
The recent Luxury-Home Sales Sink 38%, the Biggest Decline on Record report from real estate research firm Redfin covered 60 large counties based on population. Note that sales in these markets rose almost 80% year over year in mid-2021.
[nativounit]
One reason for the surge was low mortgage rates, below 3% for 30-year fixed home loans. That figure jumped to about 6% recently, as the Federal Reserve raised rates to combat inflation. It also is likely that as the rich moved out of cities, the demand in areas with expensive homes rose.
[wallst_email_signup]
Redfin defines luxury homes as those in the top 5% based on price in each market they cover. High-end homes in the most expensive housing markets overall took the worst beating. In addition to Nassau County, “Next came four California metros: San Diego (−60.4%), San Jose (−58.7%), Riverside (−55.6%) and Anaheim (−55.5%).”
[recirclink id=591561]
The median luxury home prices in these areas are extraordinarily high. In Nassau County, the figure is $2.4 million, and in San Diego it is $3.2 million. San Jose, the most expensive market in the country, has a median luxury home price just below $4 million. That is about 10 times the median home price for all homes across the United States.

If anyone can afford a downward reset in home prices, it is the very rich. That day has come.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.