According to numerous articles and statistics, the luxury home market is definitely heating up. Many cities around the world are experiencing exponential growth, and the number of people who are buying and selling executive homes in the Denver area and elsewhere is on the rise.
The Laws of Supply and Demand
The price of things like milk and gasoline rise and fall due to supply and demand. The less of something there is, and the more people who want that something, the more it costs. The same principle drives the real estate market, too. There are a limited few executive homes for sale in any given market, so naturally, this drives up the price. Finally, when multiple buyers are interested in the same property, it is possible for that price to climb even higher as they buyers try to outbid each other. Although the market tends to favor sellers at this point, buyers are not slowing down.
Another reason why the luxury real estate market in Denver is heating up has to do with the city itself. A representative from Coldwell Banker Residential Brokerage spoke with Investopedia.com, claiming that the sales of luxury homes – meaning those valued at $500,000 or more – climbed 44% between 2012 and 2013, and that trend continues even today. This is fueled by Denver’s outstanding job market. When compared to other US cities, Denver has unusually low unemployment rates and plenty of high-paying jobs. This drives the executive real estate market.
Buyers from Other Countries
Believe it or not, buyers from other countries make up a good percentage of the United States’ luxury home sales. According to the NAR, or National Association of Realtors, international transactions represented 4% of the entire monetary value of real estate purchases and 6% of all home sales in 2013. Although the most popular states for international buyers are Texas, Florida, California, and Arizona, Denver is seeing an increase in the number of international buyers due to its booming local economy.
The Availability of the Internet
The Profile of Home Buyers and Sellers reports that nine out of 10 buyers utilize the internet when searching for and ultimately buying their executive homes. In the 2013 report, they stated that 43% of all consumers who purchased luxury homes around the country first saw their homes online. This is true even with the innate disadvantages associated with online shopping for luxury homes. Sellers are often very wealthy or celebrities, so in order to protect their privacy, they do not list through traditional engines or even MLS. Nonetheless, many real estate agents maintain databases of these homes and regularly offer them to their clients via the web.
The luxury home market has been heating up for years, even despite the financial crisis of 2008 that still has many people reeling. In Denver, especially, where the local economy is booming, unemployment is down, and high-paying jobs abound, the executive home market is heating up. It’s a great time for buyers and sellers alike.