A year-end report from Realtor.com predicts that rising mortgage rates, changing tax laws, stock volatility and rapid price growth will continue to soften high-end home sales in markets around the country in 2019.
High-tax, high-income markets, including Honolulu and New York, are expected to see the largest slowdown in luxury sales over the coming year, while low-tax areas, including luxury markets in Colorado and Tennessee, are expected to continue to grow.
The flurried pace of high-end housing activity is showing clear signs of slowing nationwide, as economic and political uncertainty creeps into buyers’ psyche. Some of the country’s most expensive markets, including Manhattan, Los Angeles, Chicago and Seattle, saw sales decline year over year in 2018.
Subdued sales caused luxury inventory to build up for the first time in two years. By December, the number of million-dollar-plus listings on the market was up around 16% compared to a year ago.
"Home prices in the segment could begin to adjust if supply continues to build up and luxury buyers begin to reassess the value of their purchase. The result could see some sellers re-calibrate expectations, with more properties seeing price cuts," Realtor said in its official luxury forecast.
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