The number of Golden State homes sold for a million dollars or more rose last quarter to its highest level in almost five years, the result of an improving economy, some price increases and improved mortgage availability. The year-over-year gain for $1 million-plus sales was nearly double the increase for the overall housing market, a real estate information service reported.
A total of 7,763 homes sold for $1 million plus during the April-to-June period. That was up 79.5 percent from 4,325 during the first quarter, and up 18.5 percent from 6,553 in 2011’s second quarter, according to San Diego-based DataQuick.
The jump in million-dollar sales last quarter outpaced overall home sales. Total California home sales – including all price levels – increased 10.3 percent year-over-year last quarter, from 109,713 in second-quarter 2011 to 121,058 last quarter.
Last quarter’s $1 million-plus sales were the highest since third-quarter 2007, when 10,946 changed hands. The highest quarter in DataQuick’s records, which go back to 1988, was third-quarter 2005, when 15,898 homes sold for $1 million or more.
“This market always responds to its own set of incentives. Most homebuyers agonize about income, down payments and mortgage interest rates. And while there may be some of that in the prestige market, buyers there also watch what kind of returns their assets are bringing from investments and savings. If your money is parked in a savings account or something else that is low-risk, you’re not making much and real property might look good,” said John Walsh, DataQuick president.
There is seasonality in comparing the quarterly numbers, let’s consider the year-to-date data.
These are detached-home sales between La Jolla and Carlsbad between Jan 1st and Aug 11th:
|Year||# of Sales||Avg SF||Avg $/sf||# of Sales||Avg SF||Avg $/sf||% $1M/Total Sales|
While Dataquick makes it sound like the high-end market is on fire, you can see that there hasn’t been any big change around NSDCC in the over-$1,000,000 category year-over-year. We can say that it has firmed up nicely so far, with the average square footage being virtually the same this year as in 2010, and the average $/sf up +4.6% since then.
The under-$1M sector is enjoying a +20% surge in additional sales Y-O-Y, but you can see why – the average square footage has been increasing, and cost-per-sf is still in decline.