Million-dollar-plus home sales grew at 9.1% statewide compared with last year. Demand for high-end homes is still growing as total overall sales sales fell 7.4%. Affluent parts of the Bay Area and Southern California especially the coastal areas continues to draw a demand pushing up prices in those areas. Hot technology jobs in these areas also mints additional new millionaires who can afford expensive homes. This market behaves differently as it responds to its own set of criteria as these buyers are less likely to agonize over credit scores, income, job security, mortgage rates and down payments. Looks like the market is still sizzling as price increases grew at 11.6% over the past year.
Million-dollar home sales hit seven-year high in California
Sales of million-dollar-plus homes hit their highest level in seven years in the second quarter. (Tim Rue / Bloomberg)
That’s according to new figures from San Diego-based DataQuick, which tracks local housing markets in the state. They found million-dollar-plus sales grew at a 9.1% clip statewide compared with last year, while sales overall fell 7.4%.
Several factors are driving the high-end liftoff, market-watchers say.
One is the hot technology sector in the Bay Area and some affluent parts of Southern California, which is minting new millionaires who can afford seven-figure homes. Another is the 11.6% price growth in California over the last year, which means a house worth $925,000 last summer may be worth $1,032,300 today. And there’s the influx of international buyers, which is pushing up prices at the high end.
Then there’s that old saw that the rich are just different than you and me, especially in a time when credit is tight and the job market remains soft for many middle-income home buyers.
“It’s always fascinating to watch this part of the real estate market. It behaves differently, responds to its own set of criteria,” said DataQuick analyst Andrew LePage. “These buyers, especially those in the multi-million-dollar market, are less likely to agonize over credit scores, income and job security, down payments and mortgage interest rates.”
Of course, in the most desirable parts of coastal California, a million-dollar home is rather routine. Half of all homes sold in San Francisco County in June exceeded $1 million, according to DataQuick, and parts of Los Angeles and Orange counties regularly cross into seven figures.
The market for even higher-priced homes is even hotter. While there were more million-dollar homes being sold here in the mid-2000s than today, California in the second quarter set all-time records for the number of homes sold for more than $2 million, more than $3 million, more than $4 million and more than $5 million.
Source:http://www.latimes.com/business/realestate/la-fi-million-dollar-homes-seven-year-high-20140731-story.html
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