Luxury home sales in the U.S. are soaring faster than lower-cost segments as remote work, brimming stock portfolios and rising listings give wealthy buyers an edge.
In the three months through April, purchases of high-end homes increased 26% from a year earlier, according to a report by the brokerage Redfin. Sales of the most-affordable properties — in high demand by first-time buyers, downsizers and property investors alike — rose 18%. Mid-priced homes gained 15%.
The rich are best-positioned to buy real estate, now that vaccines bring the pandemic’s end into view and the inventory crunch begins to ease. Listings of high-end homes in the three-month period rose 19% from a year earlier, outpacing a 14% gain for affordable properties and a 9% increase for mid-priced listings, Redfin said.
“So far, the economic recovery from the pandemic has disproportionately benefited Americans with bigger bank accounts,” Redfin Chief Economist Daryl Fairweather said in the report. “This means a lot of the demand for homes is coming from folks who are well-off, while many lower-income Americans sit on the sidelines because they’ve been priced out of the housing market due to surging prices.”
Redfin divided U.S. residential properties into three equal-sized buckets based on the homes’ market values. The year-over-year changes for prices and inventory were somewhat exaggerated because pandemic lockdowns froze transactions for a couple months starting in April 2020.
San Francisco led the surge in expensive home purchases, with an 82% jump, according to Redfin’s analysis of the country’s 50 most-populous metropolitan areas. Following were neighboring Oakland, with a 72% gain, and Miami, where high-end sales rose 70%.