Luxury home buyers from northern U.S. cities and Canada—known as "snowbirds"—are flocking south and driving real estate markets in smaller Florida cities, according to data Realtor.com published Thursday.
Sarasota and Collier, comparatively low-key counties on the southwestern coast of Florida, led Realtor’s ranking of the fastest-growing luxury markets in the U.S., coming in first and third, respectively. Their growth underscores the desire for buyers who’ve built their wealth in high-tax states like New York, Connecticut and Illinois to seek tax relief following the law Congress passed in December.
Luxury Miami Home Sales Rose 24% in May https://t.co/7veKSUKdyt pic.twitter.com/UZF6GHut0T
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"Search data shows these Florida markets in particular are attracting buyers from regions up north, including luxury buyers from Chicago’s Cook County, Boston’s Middlesex County and New York’s Brooklyn and Manhattan," Realtor said in a news release on Thursday.
Realtor based its luxury index on sales prices recorded in 89 cities through March, and defines luxury as the top 5% of the market.
In Sarasota, prices grew 19% in the year through March and 14% in Collier County. Entry-level luxury buyers are also fueling activity in Broward County, where prices grew 9%.
"This upward pressure on luxury prices in certain parts of Florida appears to have started last November," just ahead of Congress’s tax overhaul, according to the Realtor report.
Western states, including warm climates and vacation markets, have also seen strong price growth over the past year.
The Bay Area of California, including San Francisco, Silicon Valley and the wine regions, also continue to see strong price growth.
San Mateo County, part of Silicon Valley, recorded annual price growth of 13%, hitting $3.496 million in March. Prices rose 12.4% to $3.22 million in Marin County.
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Douglas County, Colorado, ranked No. 4 with price growth of 13.1%. And King County, which encompasses Seattle, saw prices jump 12.8% to $1.486 million.
Meanwhile, major metro areas and hubs for luxury activity, including New York City, Chicago and areas around Boston, have seen declines. Luxury prices fell 2.7% in Suffolk, Massachusetts, in the year through March and dipped 2.2% in Cook County, Illinois, which includes Chicago.
An exception to the decline in northern cities was Queens, a more affordable borough in New York City, ranked second in the country, with price growth of 15.1%.