Some of the markets where luxury home prices haven’t soared are densely populated areas that people left during the pandemic as remote work options allowed them to live further away from their big-city jobs.
Hannah Jones, senior economic analyst at Realtor.com, said with home prices already soaring, there isn’t much room for prices to rise, especially with buyers still unable to buy.
For example, Seattle’s luxury home price benchmark has risen by about 24 percent, less than half the rate of increase for general luxury housing.
“In places like Seattle, prices, especially luxury homes, but overall home prices, have stabilized during the pandemic as people have moved out of larger coastal cities,” Jones said. “So it’s not surprising that we haven’t seen the same price increases due to the pandemic.”
There’s also a question of supply and demand: As highly paid office workers had the freedom to work remotely during the pandemic, demand surged in areas away from the country’s densely populated coasts, meaning luxury home prices in those cities haven’t seen as much upward pressure as in suburban and rural cities.
But there are several small and mid-sized cities where luxury home prices have remained more stable than in other parts of the country, many of which are in the Midwest, where home prices have remained historically low.
For example, in Toledo, Ohio, you can purchase a luxury home for less than the national average of $430,000. The most expensive 5% of Toledo listings start at $336,000. That’s right, you can find homes on spacious lots with Midwestern charm, all at affordable prices.
The study also found that cities like Tulsa, Oklahoma, and Wichita, Kansas, have seen minimal increases in luxury home prices.
“These areas didn’t see price increases due to the pandemic,” Jones says, “so it’s not surprising they didn’t see the same luxury home price increases over four years.”
These cities’ initial economic conditions, and potentially less speculative investment, may have made them less vulnerable to broader price fluctuations, Jones added.
Alternatively, in some of the markets on our list, the slowdown in luxury price growth could be due to people looking for more affordable prices rather than luxury buyers.
For example, home buyers Stockton, CaliforniaOver the past four years, as residents seek to escape exorbitant housing prices in nearby cities like San Francisco, median home prices in Stockton have risen nearly 60%, while luxury home prices have risen just 19%.
“People were moving out of the area looking for affordable housing in California, but they weren’t looking for luxury housing in California,” Jones said.
So what does this mean for today’s home buyers? It depends on your personal situation and the market you’re buying in, but luxury homes are likely to be relatively more affordable than before.
Here are the 10 cities with the most stable luxury prices over the past four years. To ensure geographic diversity, we only included the cities with the lowest luxury price growth per state.
April 2020: Most Expensive 5% of Properties: $2,995,900 and Up
April 2024: Most Expensive 5% of Properties: $2,972,500 and Up
Increase: -1%
Number of properties over $2,972,500 as of April 2024: 115
The most expensive 5% of properties in April 2020: $324,670 and up
April 2024: Most Expensive 5% of Properties: $335,700 and Up
Increase: 3%
Number of properties over $335,700 as of April 2024: 18
The most expensive 5% of properties in April 2020: $938,888 or more
April 2024: Most Expensive 5% of Properties: $998,450 and Up
Increase: 6%
Number of properties over $998,450 in April 2024: 24
April 2020: Most Expensive 5% of Properties: $765,000+
April 2024: Most Expensive 5% of Properties: $895,858 and Up
Increase: 17%
Number of properties over $895,858 as of April 2024: 34
April 2020: Most Expensive 5% of Properties: $849,003 and Up
April 2024: Most Expensive 5% of Properties: $1,004,188 and Up
Increase: 18%
Number of properties over $1,004,188 as of April 2024: 18
The most expensive 5% of properties in April 2020: $632,765 and up
April 2024: Most Expensive 5% of Properties: $749,900 and Up
Increase: 19%
Number of properties over $749,900 in April 2024: 21
The most expensive 5% of properties in April 2020: $1,022,273 or more
April 2024, Most Expensive 5% of Properties: $1,219,167 and Up
Increase: 19%
Number of properties over $1,219,167 as of April 2024: 31
The most expensive 5% of properties in April 2020: $1,068,488 or more
April 2024: Most Expensive 5% of Properties: Over $1.3 Million
Increase: 22%
Number of properties over $1.3 million as of April 2024: 47
The most expensive 5% of properties in April 2020: $669,443 and up
April 2024: Most Expensive 5% of Properties: $814,638 and Up
Increase: 22%
Number of properties over $814,638 as of April 2024: 54
The most expensive 5% of properties in April 2020: $2,350,000 or more
April 2024: Most Expensive 5% of Properties: $2,912,450 and Up
Increase: 24%
Number of properties over $2,912,450 as of April 2024: 81
