Luxury home prices have risen 0.8% nationwide over last year in the second quarter of 2016, according to a new Redfin analysis of the top 5% most expensive homes sold in 1,000 U.S. cities. Luxury inventory has fallen 0.5% from last year, while sales for homes priced above $1 million have increased 10.7%.
Going forward, Redfin chief economist Nela Richardson anticipates a rise in foreign U.S. luxury purchases in the wake of the Brexit vote and its market consequences, as investors pull out of the U.K. However, “Foreign buyers who normally flock to these cities are also highly sensitive to global volatility,” Richardson says. “I expect a bit of motion sickness as high-end buyers decide whether parking their money in real estate is a safe place in a rocky global economy.”
The “biggest winner” in this uncertain climate is Miami Beach, FL, where luxury prices made a 22% jump following a 14% dip last quarter. Most of the other market “winners” have a buyer base of mostly local full-time residents, and luxury price points under $1.5 million, Redfin says.