While the prime residential markets across the U.S. gained some steam in the second quarter, Miami suffered a 23% fall in the average price for a luxury home, the deepest decline among cities recording at least 40 luxury sales within the three-month period, according to Redfin’s quarterly report released Thursday.
The average price for the country’s luxury homes, which Redfin defines as the top 5% sales in each of the 1,000-plus cities it tracks, reached $1.79 million in the second quarter, increasing 7.5% from a year ago.
Miami’s average luxury price fell to $1.86 million, down 23% from the same period last year. But compared to the first quarter, the average luxury price rose 7.8%, signaling improving market conditions since 2017.
The bottom 95% of the market gained 7.9% in the average price, to $300,000, according to the report.
The poor performance in the city’s luxury markets is partly due to an abundance of high-end condo developments, Jose Medina, a Miami-based agent with Redfin, said in the report.
“The luxury condo market is completely saturated right now,” he said.
The number of homes for sale priced at or above $5 million in Miami increased 166.7% compared to last year, according to Redfin.
On the other extreme of the spectrum, Irvine, California, saw a 37.4% jump in the average luxury prices, the biggest winner among comparable cities. The city’s average luxury price $3.5 million almost doubles the national average.
Redfin local agent Karl Stenske attributes the strongest price growth in Irvine to the robust tech sector.
“With technology companies continuing to move into the area, bringing high-wage jobs, we are seeing the related increase in demand impact high-end housing prices,” Mr. Stenske said in the report.
The most expensive homes sold in the second quarter was the famed L.A. estate of Edie Goetz, according to Redfin. It was purchased by billionaire investor Nicolas Berggruen for $40.8 million in April.
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