With half of Santa Barbara metro area closed sales in March classified as “luxury” homes ($1 million-plus), a recent survey by the California Association of Realtors of the luxury market provides some valuable insights.
The annual total statewide sales of $1 million-plus homes from 2011 to 2013 saw an increase of 35 percent, while homes under $1 million saw a decrease in sales of 8.4 percent.
In January 2014, $1 million-plus home sales were 43 percent above January 2013.
With this higher rate of sales, the backlog of unsold of $1 million-plus homes has dropped from 8.9 months of inventory in January 2013 to 6.9 months in January 2014.
The survey found that of luxury ($1 million-plus) home buyers and sellers, 74 percent were college educated with 32 percent obtaining graduate degrees; 48 percent were single and the median age was 53. The median income was $350,000, and 92 percent permanently resided in the United States. Only 24 percent were married.
For 85 percent of luxury home buyers, it was not their first home. Four of five repeat buyers owned more than one home.
The most popular attributes of luxury properties sold included a hilltop location (41 percent) and an ocean view (28 percent). Luxury buyers were not so much interested in distressed properties, as 90 percent of sales were “traditional” with a normal seller.
The top two reasons for luxury home purchases were a larger home and a better location, and luxury home buyers intended to keep their properties longer, a median 10 years as opposed to the median of six years for lower-priced purchasers.
This survey is just one of the many marketing insights and tools provided to Realtors for use assisting their clients by the California Association of Realtors.
— Ed Fuller is a real estate broker with San Roque Realty Inc. and president of the Santa Barbara Association of Realtors. Contact him at firstname.lastname@example.org or 805.687.1551. The opinions expressed are his own.