The largest and most heavily populated cities across the U.S. continued their fall from grace at the tail end of 2020 as well-heeled home buyers directed their attention from metropolises to suburban living, according to Monday’s luxury market report from realtor.com.
The online property portal tracks the top 5% most expensive residential listings in 95 counties for its luxury index, and it was suburbs and secondary luxury markets that had the most prosperous fourth quarter in 2020.
Those increases are being underpinned by the seemingly insatiable appetite for more square footage, more privacy and more green space—amenities that are scarce in city centers.
Indicators point to a generally healthy high-end real estate market in the U.S., though some markets are outpacing others.
Of the 95 tracked locales, 83 saw price growth in the fourth quarter and luxury homes were selling in an average of 120 days, 15 days faster than the same time in 2019, according to the report.
“After slowing last spring, luxury home sales and prices outside urban city centers mostly rebounded last quarter, although not quite to their pre-pandemic levels,” Danielle Hale, realtor.com’s chief economist, said in the report.
“Suburbs and secondary markets in Colorado and California saw especially strong growth, which follows the widespread trend of buyers choosing the suburbs over urban life during the pandemic, while big city markets like the San Francisco Bay Area, Los Angeles, Boston and Hawaii saw the largest luxury home price declines,” she added.
As the markets strengthen, buyers are now having to part with more money to be considered luxury homeowners. The entry point to qualify as a luxury listing or make the top 5% of homes on the market, reached $3.4 million in the fourth quarter, up 14% from 2019.
Jefferson County, a suburb of Denver, ranked as the fastest-growing luxury housing market of the fourth quarter with the entry point for luxury reached $2.97 million, up 81% year over year.
Nearby Arapahoe County, another Denver suburb, followed. The benchmark for a luxury listing hit $2.51 million in the fourth quarter, up 48.6% from the same time the year before.
California’s Riverside County rounded out the top three, where an annual price increase of 45.8% left the luxury entry point at $2.27 million.
Mansion Global is owned by Dow Jones. Both Dow Jones and realtor.com are owned by News Corp.