Last month a number of us at Paragon attended the “Who’s Who in Luxury Real Estate Conference” held in Vancouver, Canada. This is an annual event where Realtors from across the country share information on their local markets and study national trends.

Here is an update on luxury home markets in the country’s other “superstar cities”: 

New York –  Luxury home sale prices in Manhattan remain firm and even up-ticked recently, depending on the price range.  Right now, condos listed for $5 million and up are experiencing the highest demand. The average price per square foot in this price bracket exceeds $2,000–which is as expensive as it’s ever been.

Metro Chicago is also doing well. An ultra luxury condo in Chicago runs $700/square foot these days (five years ago it was $500/square foot) with new Ritz Carlton 3-bedroom residences listed in the high $4M range.  The single family luxury home market within city limits is also strong, with large (we’d call them mansions) homes near the North Side listed in the $4-6M range. The upper end market outside city limits in Chicago’s upper end suburbs has softened a bit in price and the inventory there is taking longer to sell.

Los Angeles – Anecdotal evidence indicates that supply doesn’t meet demand in the $6-15M range right now. And the markets in premium neighborhoods like Beverly Hills and

Brentwood remain solid, probably because just about anything for sale in these areas breaks the $6M mark.  Below that threshold, however, luxury home prices have dipped a bit and are down 1.4% over this time last year.San Francisco – In spite of the mortgage melt-down, San Francisco luxury home prices rose this quarter. Today the average price for an SF luxury home is as high as it’s ever been at just under $3.1M.  I’ve mentioned before how demand for upper-end properties (in San Francisco that’s $2M and above) seems immune to the shakes and bumps experienced by other market segments—probably because the luxury home buyer has easier access to financing or can afford to pay all cash for their new home.

The only change in the market is the numbers of buyers. Last year’s home with that ‘just right’ combination of a good lay-out, great bones, superb views, and parking might have garnered half a dozen offers. There’s still a shortage of such properties but now when one comes up only two or three buyers step up to the plate. 

A San Francisco luxury home seems inexpensive when compared to other international luxury markets. Many off-shore investors are buying second and third homes here.  Generally, their tastes run towards new and modern. We’ve heard stories about Asian Rim buyers purchasing penthouse units in condominium high rise buildings or buying multiple units and combining them.

This expanding off-shore market may account for why it takes longer for a luxury home to sell now.  International buyers have upscale properties all over the country to choose from and the winnowing process takes more time.  The top destination states right  now are Florida, California and Texas.

This entry was posted on Tuesday, January 1st, 2008 at 9:12 pm and is filed under Investors, Market Conditions. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.

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