As was reported in my regular blog, area real estate sales in the first quarter of 2014 have gotten off to a somewhat slow start. This winter's excessive snowfall and abnormally cold temperatures have had a profound impact on our ability to show properties and in many cases weekend road closures prevented would-be buyers from making it up here even when showing appointments had been booked.As with the mainstream segment of our market, the upper-end price ranges or luxury home market has felt a softening of sales in the first quarter of 2014 versus 2013 with one notable exception. Sales in the $700,000 to $800,000 range from January 1st to March 31st are five times higher than the same period last year with 10 MLS® sales having been reported in this segment compared to just 2 one year ago. At the present time, there are 46 properties listed for sale between $700,000 and $800,000 or roughly 13 months worth of inventory. Conversely, there are 89 active listings for homes and condominiums price above $1 million which represents 4.4 years of inventory based on the current rate of sales.
Typically, first quarter sales in the upper price segments of our market are very strong. I have always attributed this to the timing of year-end bonuses paid to senior executives or business owners having had a good year and thus affording them to make a large discretionary purchase as a reward. There is seemingly no sound economic reasons to explain the weaker luxury home sales during the first quarter or 2014. Interest rates remain low although many of these purchases are cash anyway. Consumer confidence is up and real estate remains an attractive investment for most.
I suspect the arrival of warmer weather will trigger an upturn in market activity overall and this will spill over into the upper end market segments as well.
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