Luxury Buyers Bolster August Home Sales

Sales this summer have been sizzling, proving that buyer demand has yet to run out of steam. That mainly goes for mid- to high-end buyers, as affordable homes continue to be few and far between. Home prices are 11.4% higher than they were last year, according to Realtor.com. Homes priced under $100,000 decreased by more than 20% compared to last year, yet million dollar luxury homes are rising exponentially. As the number of affordable homes dropped, properties priced $1 million or more advanced by 44%. The luxury housing sector is boosting numbers, according to one economist.

Economists polled by The Wall Street Journal had expected home sales to rise 3.2% in August. In July, existing-home sales had risen a record 24.7%.

The continued increase in sales in August was greatest among mid- and high-price homes, a sign that low inventory of homes for sale remains an issue at the lower end of the market, leaving many with few buying options. The shortage of more affordable homes is also helping push sales prices to record highs. The median sales price of an existing home in August was $310,600, 11.4% higher than it was last year.

“The lower the price point the greater decline in inventory,” Mr. Yun said.

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