Luxury Homes Wilt On The Market
Follow on 
Luxury homes — those mansions on the hill — are not selling like hotcakes. In fact, such homes are being re-priced with newer and lower values
The Institute for Luxury Home Marketing says that of 40,252 luxury properties available during the past week, the typical price was $1,156,708 and the cost per square foot averaged $324.
Just as interesting, 41 percent of the properties had seen price decreases and the typical luxury home is on the market 172 days — almost six months.
It’s worth remembering that the mortgage crisis was originally described as a “subprime” problem; you know, something that invovled poor people and those with marginal credit. Now we find that, whoops, we’re all in this together and that even the rich are getting stuck.
The universality of the mortgage problem has been obvious for the past five years. You can’t have a local real estate market which suffers in part while other slices of the marketplace are untouched because all segments of the market are tied together.
Example: You need first-time buyers — about 40 percent of the market — to purchase homes because that allows current owners to move up — thus it makes sense to support the FHA and VA loan programs.
Thus it also makes sense to support efforts to reduce foreclosures and to keep families in their homes.
Is there any good news on the luxury front? Just a touch — the ILHM reports that 3 percent of the luxury homes for sale were re-priced up, meaning owners were asking for more.
Oh to be among the lucky 3 percent….
For the full report, please go to the ILHM Luxury Housing Report.
© Copyright 