Last month Lawrence Yun, the chief economist for the National Association of REALTORS®, delivered his state of the union address to the members of the association at the annual meeting in Anaheim, CA. During the presentation Yun shared the myriad of data that he uses to analyze the housing market across the US. After more than thirty slides of charts and graphs depicting various trends and aspects of the market, Yun summarized by stating that current record low interest rates in conjunction with the very high affordability of residential property has created a once-in-a-generation opportunity to buy property throughout the real estate spectrum.
This year buyers in the luxury home segments across the country responded to these real estate opportunities by recording an impressive number of notable sales many of which were recently completed. New York City was particular noteworthy with over 25 sales in excess of $10 million dollars during 2011. Included among these residences was this month’s closing of the record-breaking sale of a Central Park West condominium of 6,744 square feet for $88 million. Two other residences sold for $48 million apiece earlier this year in Manhattan. Further up the coast, Boston enjoyed a remarkable November as 25 residences in excess of $1 million were sold and a further 20 were put under contract. In the Hamptons a modest waterfront property on 2.5 acres recently sold in for $23 million.
The West Coast also enjoyed exceptional activity in the luxury market. In the last three months, San Francisco reported that four homes sold for over $20 million each. The Los Angeles market produced 30 sales over $7 million in November alone. Just outside Atherton The Levi Strauss estate sold for $53 million in September. But perhaps the most impressive sale was a 25,000 square foot compound in Silicon Valley that commanded $100 million.
Outside the Northeast and the West Coast, other states saw luxury segments rack up many significant sales. South Florida, one of the hardest hit states during the downturn, recently completed a transaction for the highest price per square foot ever paid for a condo in that market. In Palm Beach more than a dozen homes sold this year with price tags of over $30 million and Miami had four sales in excess of $20 million in 2011. There are similar reports from Chicago, Dallas, Houston and other large metropolitan areas.
Communities outside of the largest metropolitan areas also saw notable sales of their luxury home segment. One of the largest resort sales occurred this year in Maui when an oceanfront home on 1.7 acres sold for $27 million. Closer to home in Aspen there were 19 sales over $10 million in 2011 – more such sales than in any previous year. Vail and Jackson Hole also saw very significant transactions in the luxury residential market.
Telluride joined in the flurry of luxury property sales with 30 residential properties selling for over $2 million this year including a $7.25 million home in Aldasoro. Of particular interest is that a nearby 1,134 acre ranch parcel with an asking price of $18.8 million has recently gone under contract. Additionally, there are recent reports of buyers bidding on properties with asking prices in excess of $10 million.
This year’s activity in the luxury real estate market has been widely noted in preeminent national publications but perhaps Barron’s captured it best by noting that “Two years after the worst of the financial crisis, the rich have dusted themselves off and resumed some serious discretionary spending. Both sales volume and prices are clearly on the rise for luxury vacation homes. One of the greatest indulgences of all.”
Telluride Association of REALTORS®.
Other Sources: Wall Street Journal, Forbes, National Association of Realtors, Sotheby’s International Realty, Bloomberg Businessweek, Telluride MLS.