The average luxury home price increased by 1% in the second quarter of 2019, after a 1.7% decline earlier this year. Despite the gain, the luxury market remains cool, Redfin reports.
Sales of homes priced at or above $1.5 million declined 4.6 percent year over year last quarter. That’s the third consecutive quarter of dropping sales in the category, though the decline was much smaller than the 13.8 percent dip in the first quarter. Sales of homes priced under $1.5 million dropped 6.7 percent year over year.
Supply of homes priced at or above $1.5 million increased 18.7 percent in the second quarter, the fifth straight quarter of rising luxury inventory and the biggest increase in two years. Supply of homes priced under $1.5 million increased just 2.1 percent annually.
The minor gain in prices, along with dipping sales and a significant increase in supply, suggests that demand for luxury homes is tepid, especially compared to the past few years. But while the second quarter was relatively weak for the luxury market, it marked a small rebound from the first quarter, when prices declined for the first time in nearly three years, sales posted their biggest decline since 2010 and supply increased by double digits.