Luxury home prices, defined in Redfin’s home sales data as the top 5% most expensive home sales prices in each of over 1,000 cities each quarter, rose by 5.2% YOY up to an average of $1.9 million in the second quarter of 2018. This marks a slowdown from the previous quarter, when luxury prices rose 7.3% YOY.

Luxury homes also went under contract after an average of 65 days on the market last quarter, six fewer days than the second quarter of 2017. This is the fastest luxury sales pace on record since Redfin began tracking in the first quarter of 2019.

Cities across Florida and the Western U.S. saw the nation’s largest increases in luxury home prices in the second quarter. In West Palm Beach, Florida, the average sale price for a luxury home soared 85 percent over last year to $2.24 million. Luxury home prices were up 59.1 percent in Boynton Beach, Florida, 27.7 percent in Henderson, Nevada, and 27.5 percent in Seattle.

We believe some portion of the gains in these cities can be attributed to the $10,000 cap on state income and property tax deductions established in the new tax code, enacted in December 2017.

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