California accounted for 48,666 of the 109,113 million dollar plus homes sold last year. That represents almost 45%. Yikes!
Real estate markets may be cooling around the country, but they were hot enough last year to send million-dollar home sales through the roof. The number of homes sold for $1 million or more quadrupled between 2000 and 2005, according to DataQuick Information Systems, to 109,113. (Of 8 million sales overall last year, the median sales price was about $213,000.).
Friday, May 19, 2006
Number of Milllion Dollar Homes Sold Skyrockets
The number of million dollar or more homes sold in the US has skyrocketed in the past 5 years due in large part to the housing bubble.
Subscribe to:
Post Comments (Atom)
Posts
People who are in the market for those houses can ask for bigger bonus checks if they are executives or increase their fees if they are lawyers or doctors.
ReplyDeleteA large majority of us who priced out of studio condos can't expect salary increases to compensate for housing costs.
A bet alot of recent college grads are saying I wish I was born 5 years earlier.
I wish I was born 5 years earler.
ReplyDeleteI don't think that the number of million dollar houses means anything other than homes are terribly overvalued. A one million dollar home in northern virginia is a 4 bedroom, 3200 square foot house on .3 acres, 15 feet away from another million dollar home. 45 minutes away from DC.
Basically, a million busks ain't worth jack when a 30 year old, pretty nice house is $750,000.
Anom 6:47
ReplyDelete"I wish I was born 5 years earler"
What I meant with that statement is if a 2005/6 college graduate was born 3 years earlier they could have bought a house. Changes are they has an older sibling or friend who bought a house and they thought when they graduate they too can buy a house. SURPRISE!
Yes I agree a million bucks don't buy jack. Now with 40 and 50 year mortgages and studios costing 300K+ and regular family detached homes approaching 1 million this is becoming more like Tokyo.
SEE THE FUTURE! LIMITED TIME ONLY! Run "Find and Replace" - insert "Washington" for "San Diego"...
ReplyDeleteDowntown's Dark Towers
Karen McElliott came to downtown San Diego looking for a new way of life. After 30 years living as a suburbanite in Scripps Ranch, McElliott, a widow, came looking for the bright lights of the big city.
She found a community with much of the vibrancy and energy that she hoped for. What she hasn't found are neighbors.
Of the six units on her floor in her new condo building, McElliot's is the only one that's occupied. The Pinnacle, like many of downtown's newer condo towers, is currently only 55-percent occupied by full-time residents.
"I was looking forward to meeting new neighbors, and having them over for a glass of wine or saying hello and going for walks in the morning, that kind of thing, and that hasn't happened," McElliott said.
As investors and speculators have flocked to the downtown San Diego condo market, many of the roughly 7,000 downtown units -- especially those that have come online during the last two years -- have remained empty of full-time inhabitants.
According to DataQuick, a local real estate information service, around 33 percent of all downtown homes have their tax bills sent to a separate address, indicating that they are not full-time residences. Although the empty hallways are an unexpected consequence of the recent condo boom, experts expect the buildings to fill in over time as residents replace investors.
As condo prices soared in downtown, investors from around the county, state and country saw a market where some serious money could be made and invested in condos that they never really planned to live in.
But as the real estate market in downtown San Diego cools off, London said those speculators are leaving the downtown market behind.
If you had been born 5 years earlier so you could buy a house, then you would be wishing that you sold one year ago. As you can see, timing is a lucky thing. The window of time that would have been best to buy was between 1998-2001. Prices were low and interest rates were falling. If you owned during this time, then you enjoyed a falling mortgage payment due to refinancing, and now you are set to rent at a monthly gain if you wish, or stay in and enjoy your low payments.
ReplyDeleteYou can't help when you were born, and you can't time the market. You can; however, use common sense to realize that buying or holding a 1br condo valued at $500k is not a smart thing to do. Think back on the thought of paying that kinda money 5 years ago. Real estate is not supposed to gain value this quickly, and the market giveth and the market may taketh away.
A reversion to the mean is well overdue, and we have already seen rising inventories all over the country - what is to follow is obvious. Bubbles will inflate, but 500% increases in inventory will inevitably lead to price declines. Beware of those who previously argued that a lack of supply is the reason for home prices to rise, but now deny that home prices will fall even in the face of exploding inventories. They are practicing emotional economics and heeding their advice is the surest way to the poor house.
Tulip Mainac,
ReplyDeleteAre you distinguishing between supply on the market on any given day and overall supply of units vs demand?
If you look at population growth of the DC area vs the increase in supply of housing units you will get a very different picture.
Of course that does not mean there is not an over supply of overpiced condos. However, there is some fundamental support for the overall market that differentiates 2006 from 1989.
Pullback? Yes. Crash? No.
Shakeout in the first time condo developer bussiness? Definitely.
David - It might be worthhile to have a post on some of the demographic trends in the Washington DC metro area. I've searched the Fairfax county website for population trends and from what they post (census data) population growth has not outstripped housing. Just an idea. Its your blog (which I think you do an excellent job with) so take it for what its worth.
ReplyDeleteNOVA Fence Sitter
Nova Fence Sitter has a good point. Take a look at the Fairfax County webiste, but I have a different analysis.
ReplyDeleteOn this page,
http://www.fairfaxcounty.gov/demogrph/gendemo.htm
compare the relationship between the total number of households and the total number of housing units.
From 1980 to 1997 there is always more than 10,000 extra units than households. (Ok 1985 is a little tight, but that was a boom year too.) After 1997 it starts tightening up. In 2005 the data shows a delta of only 7000 units even though the population has nearly doubled since 1980.
As I said above, this isn't 1989 again where there is a glut of units out there.
Rebar - You're right there was a little tightening starting in 1997, which makes since because those were the boom years. It was very hard to find apartments in 1998 and 1999 unlike today. I'm not sure that proves there is a housing shortage and probably doesn't account for the condo units coming on line. OT I was in DC today on PA ave between the Eastern Market and Potomac metro stops and I was surprised by the number of condo projects still just breaking ground. They really are going up everywhere. I don't think they are counted in MLS or other statistics.
ReplyDeleteNOVA Fence Sitter
wvu_84,
ReplyDeleteA minor point, but 95% of doctor's reimbursements are set by Medicare, Medicaid, and the insurance companies. Sure, docs can raise their fees all they like, but the payments remain the same, frequently below the cost of delivering the care.
Housing affordability is a major issue, too many buyers chasing not enough properties and bank officers willing to lend beyond all realistic bounds.