Huge Rebounds in the Real Estate Market for Million Dollar Homes

According to information recently released by the data analysis company, DataQuick, sales increased significantly in 2012 of homes valued at $1,000,000+. While many times thought of as being hit the hardest following the real estate collapse, luxury homes are now selling more frequently than we have seen in a number of years.

The number of sales of million-dollar-plus homes throughout the state of California reached 26,993 last year. This increase is over 25% more than had been seen in 2011, and was the largest since the end of the real estate boom in 2007 (that year over 42,500 homes sold above one million dollars). Even at 26,993, we are still not at half of the record set during the 2005 peak of the recent real estate boom – almost 55,000.

The study also showed a number of other interesting facts, including:

  • A record number of buyers - 7,791 - paid cash for their expensive purchases.
  • Homes ranging from $1-$2 million accounted for just over 17,500 of the sales, while nearly 700 of them were over $5 million.
  • New-construction homes were just 4.9 percent of the sales in this price range during 2012, which is a smaller percentage than the previous year.
  • The banks which were most commonly used to acquire mortgages on these $1 million plus homes were First Republic Bank, Wells Fargo and Union Bank.

How Does This Affect Me?

In a number of places throughout San Diego County, a fair percentage of the homes cost over one million dollars. Del Mar real estate is one of the top leaders in price, with statistics from the San Diego Association of Realtors puts the average sale price of homes in Del Mar at $1,330,000 for 2012. La Jolla homes for sale are able to slightly trump Del Mar, receiving an average of $1,350,000 during the year.

If you have been considering selling your luxury property, recent activity in the market may mean that this is a good time. Since the problems began to surface nationwide in the real estate market, many homeowners, especially those in the top bracket of homes, have been unable to sell due to the dip in prices.

Thanks to the continued recovered throughout the nation, the state, and San Diego County, the market winds are blowing and showing increases in the real estate industry across a number of different fronts. Whether this is the right time for you to sell depends on your financial situation and goals, but even if this is not the ideal time for you, be sure to take a few minutes and consider how well the local economy is progressing and the ways how this can affect your real estate plans.