Since the start of the pandemic, Americans looking to buy a home have struggled with bidding wars and a limited number of houses for sale.
But one area of the cutthroat real estate landscape is improving. It’s the luxury segment, where listings are up and homes are selling at a rapid clip.
The demand is so great that even “white elephants” — high-end homes that sat on the market for months before the pandemic began — are selling quickly as their owners willingly splurge on remodeling projects to spruce them up. The motivation is the hot market for premium properties, and an urge to make shabbier ones more alluring for buyers.
At a time of unprecedented shortages of available homes, improving sales of larger, high-end properties means that a few people are moving up the price ladder, and putting a limited number of less expensive houses on the market.
“When larger homes sell, it means it is freeing up inventory in mid-market homes,” says Lawrence Yun, chief economist for the National Associated of Realtors. “There is a ripple effect, but it is small.”
