For the third consecutive first quarter, sales in Manhattan’s luxury home market declined…this time by -19% fewer contracts in Q1 2019, according to Olshan Realty. Days on the Market (DOM) spiked to 516, up from 469 DOM in Q1 2018 and 390 DOM in Q1 2017.
Donna Olshan, president of Olshan Realty, said, “In my opinion, the luxury market continued to scream: OVER PRICED!”
In California, entitled land parcels hit the market during 2018 to the tune of +$1B in addition to spikes in existing luxury inventory. (Entitled land parcels are vacant land parcels that have gone through years of approval and zoning change processes that enable buyers to buy and build immediately.)
Since last summer, 317 acres in Beverly Hills and Bel Air have hit the market according to The Real Deal’s Property Review.” These are shovel-ready sites so buyers don’t have to spend the next several years dealing with those changes and approvals and often, those changes and approvals have been grandfathered in for much larger homes than current approvals would allow.
The good news for buyers of entitled land parcels…no waiting. The bad news…”You need to have a buyer that actually has vision,” said Tomer Fridman, a broker with Compass.
High-end property sales in Florida are going a different route these days…a route to auction houses. Instead of having their properties languish on the market for months, if not years, on end as in New York, sellers are opting for the certainty of a fixed sales date much like lower-to-mid tier sellers are opting for the certainty of a fixed sales date with iBuyers.
Not only do sellers get a date certain sale date, sellers go with the odds of getting a limit to expensive carrying costs which can otherwise take years and more competition for the property free of contingencies and financing. Additionally, sellers and brokers are able to tap into the auction house’s database full of wealthy buyers worldwide while also earning commissions on the deal.
According to Marc Hameroff of Engel and Volkers Miami, “ (Buying at auction) is the way the wealthy and uber-wealthy have chosen to buy real estate in the 21stC.” Again, doesn’t this sound familiar to the iBuyer niche for the lower-to-mid-priced home market?
Concierge Auctions founder and president Laura Brady confirmed the growth of luxury auctions in Florida. “Florida is one of the leading markets for us in the $20M+ category of homes.” Concierge’s growth has gone from 102 auctions in 2016 to 292 auctions in 2017 to 522 auctions in 2018.
Naples-based Elite Auctions has seen a growth rate of +125% from 2017 to 2018. And, this auction house is already up +150% in the first quarter of 2019.
Apparently, ease, convenience and dates certain cut across all price points when it comes to selling and buying homes.