Slumping home prices create buyers market in luxury homes

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Slumping home prices create buyers market in luxury homes

For U.S. homeowners, the bad news in 2018 has been mounting, with rates on the rise and swaths of the real estate sector turning into a buyer's market. In some of the country's hottest segments, price gains have cooled definitively, with prices slashed and turnover stagnating.

The phenomenon has even been chronicled on Instagram by an account called Cheap Old Homes, underscoring how many gems have suddenly become (relatively) more affordable, depending on the location. In softer markets like formerly white-hot Seattle, 22 percent of listings are at a reduced price and—for the first time in four years – a buyer was able to negotiate to buy house for less than the listed price.

The rising inventory and falling prices means that discerning buyers can score deals on high-end property, for less than they could have otherwise. Recently, CNBC canvassed a few markets where luxury prices have dropped. In five major cities cited by Realtor.com, prices on luxury properties are now considerably lower than the firm's luxury price index, which feature homes in the top 5 percent of that market's range.

  • A room with a Central Park view

    15 Central Park West is located in an exclusive Manhattan enclave that features a private restaurant that's only for residents, a 14,000 square foot fitness facility and a large swimming pool. On the 28th floor sits a 3 bedroom, 4 bathroom unit that's selling for $26.9 million – a price tag that's dropped by nearly $2 million in the last month.

    The living room of 15 Central Park West, #28D
    Compass Real Estate
  • A Texas-sized steal

    In Austin, new builds like this $569,000, over 1,500 square-foot house have helped ease a tight housing market more toward the buyer's favor. In a relatively compact footprint, this "modern farmhouse" feels spacious with soaring ceilings, three bedrooms and two full baths, plus one half bath.

    A modern farmhouse in Texas' culture and tech hub city offers unexpectedly spacious interiors. 
    Source: Jovio
  • A gem in SoCal's slumping market

    Earlier this year, a slump in Southern California home sale was deemed a warning sign to the rest of the country. Maybe that's why one can find this level of luxury in Del Rey at $1.7 million — which is $300,000 below the average Los Angeles luxury home. In the 2,162 square feet new-build contemporary are three bedrooms and three full baths plus one half bath: It also includes niceties like wide-plank floors, skylights, and a fireplace.

    This low-slung Del Ray contemporary offers nearly 2,200 square feet plus a private back yard.
    Source: Keller Williams Beach Cities
  • Moving on up to the East Side

    In terms of space-challenged Manhattan real estate, this $1.1 million brownstone co-op in the Carnegie HIll area on the Upper East Side hits all the right notes. It has ample room (for one person or couple, that is), exclusive outdoor space, and even a functional, onyx-framed fireplace. A private garden makes any smaller residence feel larger, and there's a lot to love at a price tag that's nearly $300,000 below New York City's average luxury price around $1.4 million.

    An onyx fireplace is a highlight of this brownstone garden apartment.
    Source: Corcoran Group
  • Panoramic views in Miami

    In a luxury Miami high-rise, water views are a must. This $730,000 high floor condo apartment on ritzy Brickell Avenue is 1,500 square feet, and delivers on panoramic Miami views with floor-to-ceiling windows in the living room and both bedrooms. A balcony spans the three rooms-with-views.

    This deluxe apartment in the sky offers bay and city views. 
    Source: Coldwell Banker Residential Real Estate Miami Beach