Price Stability and the Return of
DISCRETIONARY BUYING Despite turmoil in the financial markets and increases in overall inventory, luxury home prices remained relatively stable throughout 2022 and at near-record levels. •
A lack of new desirable inventory kept prices high.
•
Buyers became more discerning.
•
Emerging affluent consumers continued to place high value on owning a luxury home.
LOW DESIRABLE-INVENTORY LEVELS
BUYERS GET MORE DISCERNING
One of the biggest challenges for both sellers and buyers in 2022 was the uncertainty of where prices would eventually settle. Should they sell now when the market is less favorable or wait to see if the market improves in 2023? Buyers were equally concerned, not wanting to pay current prices if they believed that values would trend down. This phenomenon kept the market in flux and was the reason why desirable inventory levels fell in the latter part of 2022. With so little desirable inventory on the market, it also kept prices stable.
With the buying frenzy of 2020 and 2021 behind them, affluent buyers could focus on what they truly wanted in a home with less competition. Many refused to settle for anything less than total luxury, however they defined it. They put greater emphasis on home size, condition, and amenities, rather than location. That meant homes that did not meet their criteria languished on the market while the most desirable homes sold quickly at, or slightly over, asking price – keeping the year-to-year median luxury home price steady.
R AG S QUA UARREE FFEEEETT F OORR HHOOMMEESS$ 9$0900K$ 1.1M AVAV E REAG E ES Q 0 K$ 1.1M
1,591
1,616
1,591 Washington, D.C.
1,616 Oahu, HI
1,891
2,397
Washington, D.C.
San Diego, CA 1,891
San Diego, CA
Oahu, HI
2,397
Denver, CO
Denver, CO
1,667
1,667 Boston, MA
Boston, MA
2,883
Phoenix, AZ 2,883
Phoenix, AZ
1,836
1,842
Seattle, WA
Miami, FL
2,885
3,025
Nashville, TN
Dallas, TX
1,836 Seattle, WA
2,885
Nashville, TN
1,842 Miami, FL
3,025 Dallas, TX
3,122
3,432
3,795
3,920
4,025
Chicago, IL
Las Vegas, NV
Atlanta, GA
Raleigh-Durham, NC
Cincinnati, OH
3,122
3,432
3,795
Chicago, IL
Las Vegas, NV
Atlanta, GA Source: Institute for Luxury Home Marketing
3,920
Raleigh-Durham, NC
4,025
Cincinnati, OH
