The median U.S. luxury home sale price rose by 3.6% year over year to $1.4 million during the three months ending April 30, Redfin reported Tuesday. This compares with an increase of 1.4% to $377,734 during the same period for non-luxury sales prices.
Redfin based its report on an analysis of the 50 most populous U.S. metropolitan areas. The platform defines luxury homes as those estimated to be in the top 5% of their metro area's price range, while non-luxury homes fall into the 35th–65th percentile.
Luxury prices are on the rise as demand for luxury homes increases, the report said. Pending sales of luxury homes jumped by 4.3% year over year, slightly more than the 4% gain in non-luxury pending sales.
Redfin noted that homebuyer demand has been climbing because of an improving job market and a decline in mortgage rates in April. (Rates have been more volatile in May.)
For their part, luxury buyers are typically less sensitive to mortgage-rate swings than their non-luxury counterparts, a possible reason the luxury market is holding up relatively well, according to Stacey Bryant, a Boston-based Redfin premier real estate agent.
"When I have a buyer looking at a home above $1 million, interest rates and geopolitical uncertainty don't matter as much," Bryant said in a statement. "They want to buy a home and have the means to do it, so a 6.3% mortgage rate versus a 6.1% mortgage rate doesn't really make a difference."
Here are other year-over-year findings from the report:
— Homes sold: luxury, 0.8%; non-luxury, 1.6%
— New listings: 2%; 0.6%
— Active listings: 1.4%; 2.3%
— Median days on market: 60 (+6); 51 (+5)
See the accompanying gallery for the 12 metropolitan areas with the biggest year-over-year sales price increases.
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