As the U.S. stock market rises, so do sales of million-dollar homes. That correlation is not lost on the nation's Realtors.
"There is little volatility in the stock market. It is whoppingly higher, so people in the top 10 percent of wealth are really feeling confident now," said Lawrence Yun, chief economist for the National Association of Realtors.
Sales of existing homes priced above $1 million jumped over 16 percent in October from a year ago, according to a Realtors report released Thursday, outshining every other price segment. The next strongest was the $750,000-$1 million range, up over 12 percent. Sales of homes priced under $100,000 fell 6 percent.
As a reference point, the median price of a U.S. home sold in October was $208,300. Luxury homes make up just 2.2 percent of the housing market. Lower-end, distressed homes had been making up the bulk of sales over the past two years, but there are now fewer of those on the market. Just 9 percent of sales in October were either foreclosures or short sales.
Much of the growth in the luxury segment has come from markets with heavy international interest: Miami, Los Angeles, Riverside, California, and New York. Buyers from China, Canada, Europe, Russia and South America come bearing cash and buying luxe.