What does it take to sell a luxury real estate property these days? Not a beachfront location if you were to ask Warren Buffett. His gorgeous beachfront home in Newport Beach has been sitting on the market for over a year at his initial asking price of $11M. Not a San Clemente beachfront mansion formerly owned by Richard Nixon. The current owner of that estate listed the property for $75M three years ago and is now back at it for a mere $63.5M. No one is knocking on that door either.
Or, perhaps you need a high profile celebrity name AND a great Central Park West location to sell a high profile luxury home. Just ask Bruce Willis or Sting. Willis recently sold his Central Park West two -floored apartment in lightning speed for $17.75M, the listing’s full asking price. Sting recently sold his stunning, two-floored Central Park West penthouse at its full asking price of $50M.
Owners of luxury homes in Orange County, California, are facing the same kinds of problems Warren Buffett is…no one is knocking on their doors, not even lookie lou’s.
One third of the Orange County’s luxury homes are listed for $1.25M and up but only 14% of the buyers in that market are looking for homes at and above that price point, according to market-data provider Reports on Housing. Many of these luxury Orange County homes are expected to languish on the market for 6-12 months or more.
Take a look at this chart for Orange County luxury homes that correlates prices with days on the market expectations provided by Reports on Housing…
$500,000 or less 48 days
$500,000 – $750,000 48 days
$750,000 – $1M 64 days
$1M – $1.25M 85 days
$1.25M – $1.5M 113 days
$1.5M – $2M 150 days
$2M – $4M 225 days
$4M and up 427 days
Rising interest rates and further worries about additional tightening of the Federal Reserve will only deepen the inertia of Orange County’s luxury home market. Bill Cote, a Newport Beach agent with Coldwell Banker, said, “All that’s going to do is stymie the market a little bit more.”
Often a bellwether for luxury properties everywhere, could Orange County’s current doldrums be considered just a flash of bad luck just as Willis’s and Sting’s good fortune could be considered a flash of good luck?