The Luxury Market Doesn't Care About Interest Rates

One Statistic That Shows New York is Bucking the Trend

How Long Do Most Properties Stay on the Market? 

Here's a poll: what percentage of properties priced less than $3 million stay on the market for 30 days or less?

What do you say?

• 10% 
• 20% 
• 50%
• Much Higher %
• Much Lower %!

The answer? 12%. Generally, only one in 8 properties that hit the market sell within the first month. I think most people's instincts would say that it's much higher. And outside of New York, that is probably true. According to Redfin, in 2021 43% of properties went into contract within the first TWO weeks. 

But that was a time when mortgage rates were below 3%. Normally that makes a difference. But what is normal? 

What Are the Numbers Today Above 3 Million? 

The market above $3 million should be lower than 12%, and certainly lower than 43%. And as expected, that percentage drops to FIVE PERCENT. Normally. That is, 5% of listings go into contract within the first month in New York for its luxury segment. Wouldn't that be even lower while rates are higher? 

Um, no.

Right now, that number is also TWELVE PERCENT. Another way to look at it—the luxury market is operating at 140% above its typical activity level.

All of this is to say that the Luxury Market doesn't seem to care about interest rates. It cares more about housing prices, which are down over the past three years.

This is an incredibly opportunity for homebuyers, and it won't last forever. In fact, as mortgage rates go down, prices will start to climb. And both luxury buyers and the rest will start to pile into the market. We've seen it too many times. 

Why not get into the market now? Be in touch to learn more- Scott & Magnetic