By Claire Moraa
- Ultra luxury properties are taking up to 400% longer equivalent to one year to sell
- Sale prices for ultra luxury properties have been on a decade-long upward trend
Demand at the top of the housing luxury market is dwindling with such properties taking up to 400% longer to sell. Of these homes, 12.5% of residences spent more than 600 days on the market and another 4% took more than 1,000 days to sell. And let’s be honest, slow sales are time-consuming and could ultimately depreciate the longer they are in the market, Chad Roffers, CEO of Concierge Auctions says.
Why This Matters: Let’s face it, listing homes up to 25% over market value shows that sellers are misaligned with current demand. The normal prices are already out of reach for a good number and adding onto other hidden costs and increased interest rates, it’s no surprise that even the wealthy buyers are stepping aside. The pool of potential buyers for ultra-luxury properties is already small and when properties are overpriced, this already limited pool shrinks further.
While the broader market looks dull, this high-flying sector experienced a 30% year-over-year increase in sales activity. So ultra luxury homes are indeed selling, they’re just not selling as fast as they should be. Selling above the market price is already a top problem so if sellers have to come down to 13% below their initial listing price, why not save time and avoid the exaggerated mark-up? Afterall, the longer the property is in the market, the more charges it attracts and attracts an even lower sale price.
Situational Awareness: This isn’t just about rich people’s homes not selling, it’s a reflection of the broader market sentiment, pricing inefficiencies, and shifting economic winds. There’s already a homeownership crisis so there’s no need to further inflate high-end property values.
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