Luxury home sales with prices of $1 million and up posted huge growth in 2014 according to the latest Texas Luxury Home Sales Report from the Texas Association of Realtors. In Dallas-Fort Worth, the sales volume of luxury homes was second highest in the state and grew 15 percent year-over-year. Dallas was a runner up to Houston, which had the highest volume of luxury home sales as well as the highest luxury home price growth.
The overall inventory of luxury homes in Dallas-Fort Worth shrank by 1.2 months in 2014, a trend that was seen across the market in North Texas, and luxury home sales represented only 1.2 percent of the market. Compare that to Houston, in which luxury home sales represented 2 percent of the market and were up 13 percent year-over-year.
“The attributes that have driven growth in Texas’ real estate market in recent years – job growth and population growth – are also driving the luxury market,” said Scott Kesner, chairman of the Texas Association of Realtors. “We’re seeing more demand for luxury properties from Texans whose incomes are increasing, enabling them to ‘move up,’ and from those moving to our state from elsewhere in the country.”
Locally, top-performing luxury brands are seeing more multi million-dollar sales in areas that have strong resale value and high existing demand.
“Having been the agent in three $5 million-plus architecturally significant properties, all in the last six months of 2014, I see the luxury market demand increasing as more and more families and corporations are committing to move to North Texas,” said Caroline Summers, a Briggs Freeman Sotheby’s agent. “Established neighborhoods and homes of significance in coveted areas such as Highland Park, Preston Hollow, Greenway Parks, and The Volk Estates are desperately pursued, and the quality of the design continues to be a driving factor.”
It’s true that strong demand for luxury properties has a lot to do with corporate relocation, as Texas is gaining more residents than any other state, many of which are moving to the Lone Star State from California, Florida, Oklahoma, Louisiana, and Illinois. According to the Texas Relocation Report, for every Texan that moves to California, two Californians are “Gone to Texas” as they say. Perhaps we’re the new land of opportunity?
“The overall economic growth and prosperity in Texas have contributed heavily to the luxury market, making it one of the strongest segments of housing in Texas in 2014,” said Jim Gaines, Ph.D., economist at the Real Estate Center at Texas A&M University. “We also saw a lot of people moving to Texas from places like California, where a modest two-bedroom condo can be valued upwards of $1 million. Those people sell their home in California, move to Texas and realize their money goes much further in our market. Thus, even if they don’t have an income typical of a luxury homeowner, they have assets to purchase luxury homes and are stimulating that market.”
What’s your perspective on the luxury market?