According to recent data from Zillow, the typical luxury home, defined as the top 5 per cent most valuable homes in each region, is now worth approximately US$1.8 million nationwide, with values ranging from US$835,000 in Buffalo to nearly US$6 million in San Jose.
Despite the recent cooling in market activity, luxury home values have increased 2.7 per cent over the past year, outpacing the 1.4 per cent growth seen in the broader housing market.
This suggests that there is continued strength in the high-end segment despite current challenges facing the US.
April saw a significant drop in luxury market momentum, with 12 per cent fewer luxury homes going under contract compared to March.
Spring typically brings increased sales activity, which makes the decline more notable.Â
By comparison, last April saw a 10 per cent increase in luxury homes under contract from the previous month.
Sellers also pulled back from the market, with new luxury listings down 5 per cent from March and 3.4 per cent year over year, further constraining an already limited supply of high-end properties.
California continues to dominate the top of the luxury market, with San Jose (US$5.9 million), Los Angeles (US$5.1 million), and San Francisco (US$4.8 million) ranking as the three most expensive metros for luxury homes.
The hottest luxury markets showing the strongest annual growth include Cincinnati (7.3 per cent), Columbus (6.8 per cent), Chicago (6.3 per cent), Cleveland (6.1 per cent), and Las Vegas (6.1 per cent).
Meanwhile, Austin (-2.1 per cent), Tampa (-1.7 per cent), and Miami (-0.5 per cent) are the only major markets where luxury home values have declined over the past year.
Ohio stands out for its rapid sales pace, with luxury homes in Cincinnati and Columbus typically going under contract after just five days on the market.
The gap between luxury and mid-market homes has narrowed since 2020. Currently, the typical luxury home is valued at about five times the price of a mid-market home, down from 5.5 times in 2020.
Miami shows the most dramatic price disparity, with luxury homes valued at 9.4 times higher than mid-market properties.
New York and Austin follow with gaps of 5.6 and 5.5 times, respectively.
