The ‘Normalization’ of the Luxury Real Estate Market that we first reported on in our Spring 2023 newsletter has continued.
The Luxury Market (residential listed at over $1.3 Million) is now in complete sync with the overall real estate market which includes all residential, lots, land, commercial, boat slips, and other sub-categories of the overall market.
YTD through the first 9 months of 2023, luxury sales are down 21.3 % compared to overall sales which are down 30.5%, while the average sale prices for luxury and the overall market are essentially flat.
Average list prices are up slightly for both categories and marketing times increased 58.2 % and 46.3% respectively, which are, however, still below traditional levels.
One of the most important metrics is inventory, which has been the key factor allowing for stable prices for the overall and luxury market in the face of significantly fewer sales in each category. (See our Fall 2023 Real Estate Report covering the overall real estate market in the Keys for a thorough analysis of this important topic.)
To be included in the luxury stats, a residential property had to be listed for $1.3 Million or more while some sales actually occurred at less than $1.3 Million. Our Price Range Report breaks down the 422 YTD luxury residential sales and plots them on a graph to show the range of sales prices from $1 Million to over $5 Million along with the average Days to Sell. From this graph, there appears to be two concentrations of sale prices – the lower between $1.3 and $1.7 Million (34% of Luxury Sales) and the higher between $2 and 3 million (28% of sales) while the total number of sales above $3 Million represents 20% of all luxury sales.
The Total Sales and Average Sale Price by Property Type and Waterfront graph clearly shows that the concentration of luxury sales are waterfront (69%).
The Submarkets Report compares the four submarket areas in the Keys relative to the number of sales and average sale prices along with comparing inventories and marketing times for each of the areas.
We finish the report with an Outlook for International Buyers, who do not currently represent a significant part of our market.
Our next Luxury Real Estate Report will come out in the Spring of 2024. Between now and then we expect to continue to see more luxury listings and a continued normalization of the luxury market as it continues to more closely reflect the overall market with prices continuing to remain stable. Given the continued increase in the average sale prices, we will be raising the threshold for Luxury to $1.5 Million in 2024 which will better reflect the dynamics of this market going forward.