By Alice Kantor
High-end US home sales slumped the most on record in the three months ended Nov. 30, as a weak stock market and higher mortgage costs hurt demand for prime properties.
Sales of luxury homes fell 38% year-over-year, according to real estate brokerage Redfin Corp., which measured the top 5% of listings in the 50 most populous US metro areas. That’s the biggest decline in data going back to 2012.
Nassau County on Long Island fared the worst, with sales falling 66% in the pricey region that’s bordered by New York City to the west and the Hamptons to the east. San Diego, San Jose, Riverside and Anaheim in California also experienced large drops in sale volumes.
Home prices are falling across the spectrum as overstretched budgets and an anticipated economic downturn keep buyers on the sidelines. Contracts to buy previously owned US homes declined for a sixth month in November to the second-lowest on record, according to data Wednesday from the National Association of Realtors.
The high-end market has been hit particularly hard because luxury properties are often used as investments and the outlook for home values in 2023 is lackluster, Redfin said. Affluent buyers also often have significant funds in the stock market, which is set for its worst year since 2008.
However, there are early signs that demand could pick up as interest rates decline, with mortgage applications, requests for tours and other buying services on the rise, according to Redfin.
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