This chart is interesting on a number of fronts:
Million-dollar home sales were down in the first quarter compared with Q1 2018. This is not a good sign for the luxury market, especially since we are looking at quarterly figures - which usually show less variance than monthly numbers, so this is less likely to just be a “blip.”
A couple months ago I showed a chart (stepping up to luxury) that compared annual numbers, and 2018 had the highest luxury volume ever, followed closely by 2005 and then 2006. Yet when comparing sales in the 1st quarter, 2006 was the highest (by 10%), followed by 2007, 2018, and 2019, before finally getting to 2005. This shows how much things can change in the 9 months following any given quarter. (ie: we all know how 2005-2006 bubble ended…)
2 major factors can affect the number of luxury sales: 1) The number of high net worth people wanting to buy homes in Maricopa County, and 2) The pricing movement of the existing homes for sale. If homes are trending from $975,000 towards $1,025,000, then we’ll have more luxury sales. The reverse is also true.
We’ll check back on the luxury market in a couple months to see if this trend continues.
- Chris Butterworth
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* All chart data represents single-family detached homes only. Information is believed accurate but not guaranteed.