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Luxury Home Sales Soften
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n the luxury real estate market this
year, the headlines have been dour
if not outright grim, with the mes-
sage unmistakable: High-end homes
prices are headed south around the
country, according to CNBC.
The National Association of Realtors
reported that homes priced above $1
million dipped 4 percent in August
from the previous month. While far
from being a correction, the downturn
has been noticed by more than a few
real estate market observers.
That said, not all real estate profes-
sionals are in a panic about the current
state of the market. There’s a definitive
chill in the segment of the ultra-high-
end market priced for homes above
$10 million, yet there is still a “great
deal of activity” in others, Philip
White, president and CEO of Sotheby’s
International Realty Affiliates, told
CNBC.
“Some markets are seeing a slow-
down in the high end, but some aren’t,”
said White, whose company produced
$80 billion in U.S. sales volume in
2015. “It is sort of a mixed bag, and
obviously there is some slowing,” he
said, even as he cautioned that ultra-
high-end sales were a much smaller
slice of overall real estate turnover in
the U.S.
White explained that several macro
and behavioral trends were impacting
the market, including a flood of for-
eign buyers and shifting tastes among
key demographics, particularly young-
er buyers like millennials.
*
Michigan Permits Show
Healthy Increase In August
B
ased on residential permit
data compiled by the Home
Builders Association of
Southeastern Michigan (HBA) and
reported in the HBA Southeastern
Michigan Residential Building Activity
Report, a total of 484 single-family
permits were issued in Macomb,
Oakland, St. Clair and Wayne counties
in August.
The single family permit total was
21 percent higher than July 2016’s
upward revised total of 400 and was 24
percent higher than August 2015 (389).
Furthermore, this was the best August
performance since 2006 (575).
Also notable is that late municipality
reporting of June single family permit
activity helped raise the actual number
of permits issued that month to 501
— the highest single-month total since
May 2014 and third-highest since 2006.
Multifamily activity is clearly begin-
ning to slowdown, with only 22 per-
FRI, OCT. 28 | 7:30PM
PISTONS.COM | 248.377.0100
2129710
40 October 13 • 2016
mits issued in August. The year-to-date
total of 910 represents a 2 percent
decline from the same time period in
2015 (929).
While year-over-year price appre-
ciation for both new and existing
homes has slowed when compared
to the past couple of years, it remains
positive, albeit relatively flat. With
that said, provided potential buyers
don’t stay on the sidelines during the
remainder of this presidential election
year, the existing single-family home
sales velocity of 2.9 months across the
region continues to indicate that new
home construction should be poised
for growth in the next six months.
From an economic perspective, all
indicators also remain positive as the
number of people employed and the
number of vehicles produced in North
America continue to increase year-
over-year, while energy prices continue
to decline compared to 2015.
*