Last week, I blogged about the return to extravagant spending. Could luxury homebuying finally be on the upswing? It seems that in some markets, we're enjoying a real estate recovery, with property priced at more than $2 million selling at levels not seen since the boom year of 2005, according to one study.
In Palm Beach, Fla., a mansion described as an "oceanfront chateau" (if you've seen this tony strip of an island, you'd wonder which homes couldn't be described this way) sold for $7.15 million last week. Listed at $8.95 million, it has a current assessed value of $7.1 million, according to The Palm Beach Daily News.
According to a study by MDA DataQuick for The Wall Street Journal, there are bidding wars on homes priced between $2 and $3 million in San Francisco, with one home that needed renovations in the Pacific Heights neighborhood receiving nine offers. The study reported that 49 San Francisco homes priced at more than $2 million sold in the first quarter of this year, compared with 47 in the real-estate bubble of 2005. Other areas with strong sales include The Hamptons in New York and Beverly Hills, Calif.
It doesn't seem surprising that these areas of the country would be enjoying a real-estate rebound, but there are still markets, such as Greenwich, Conn., that remain in decline, and others, such as Miami, and Las Vegas, that have a long way to go even though they've also experienced an uptick. The black lining in this silver cloud, however, is the recent volatility in the stock market, which could cause wealthy potential homeowners to retreat from homebuying until they feel more secure in their investments. Time will tell.
Are you noticing a real-estate recovery where you live?