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Sales of luxury homes in the U.S. spiked 41.5% year-over-year in the third quarter of 2020, according to a report Tuesday from Redfin.
The jump in sales of luxury properties is the largest since 2013, when Redfin started recording data, the report said. Luxury is defined as the top 5% in the country’s 49 most populous metro areas, excluding New York City.
In addition, prices for luxury homes rose 6.5% in the third quarter to $862,700, according to the report. And new luxury listings also skyrocketed in the third quarter, rising 44.9% year-over-year.
“The luxury housing market normally takes a hit during recessions as wealthy Americans tighten their purse strings, but this isn’t a normal recession,” Daryl Fairweather, Redfin chief economist, said in the report. “Remote work, record-low mortgage rates and strong stock prices during the pandemic are allowing America’s wealthy families to gobble up expensive houses with home offices and big backyards in the suburbs.”
Sacramento, California, had the highest jump in luxury sales, with a 86.1% rise compared to the third quarter of 2019, the data showed.
“We’re seeing a lot of tech workers sell their expensive Silicon Valley homes and come out here in search of more space and more bang for their buck,” Kelly Crocker, a Redfin real estate agent in the Sacramento area, said in the report.
In fact, the three cities with the biggest sales were in California, according to the report. Riverside and Oakland saw sales increase 62.8% and 60.9%, respectively.
Outside of the Golden State, the metro areas with the biggest surges in sales were Portland, Oregon, up 60.6%, and West Palm Beach, Florida, which saw a 59.7% rise, Redfin found.
Luxury home sales declined in only two of the metro areas included in the report: Philadelphia, where they dropped 8.2%, and Nassau County, New York, which saw a 2% slide.