In the first nine months of the year, 4,659 luxury homes traded in Orange County. That’s more than twice last year’s record pace.
Brokers and market watchers note that pace is not letting up, with “more closed sales in the luxury range than ever before,” according to October’s Reports on Housing.
The report considers homes priced above $1.5 million to be in the luxury range––representing the top 10% of closed area sales year-to-date––though the Business Journal more closely watches homes trading above $10 million, representing homes geared towards the region’s swath of ultra-high-net-worth individuals.
Though some reports suggest the local housing market is cooling, October’s pace of top-dollar deals prove otherwise.
Top October Deals
Last month, 13 homes sold above the $10 million mark for a total sales volume of $189.5 million. Three of those October deals sold above $20 million, with two of those in Dana Point.
The priciest sale to occur last month was 39 Strand Beach Drive, which traded for $23.5 million, a near record for sales prices in the Strand at Headlands. The 9,300-square-foot front-row home counts six bedrooms and nine bathrooms, and was built in 2017. Jennifer Wetzel of Beach Cities Real Estate had the listing; John Cain of Pacific Sotheby’s International Realty represented the undisclosed buyer.
The Sanford Edward-overseen luxury gated community has seen an especially hot year, with four homes in the neighborhood selling above $20 million.
The top sale to occur this year in the Strand is also the priciest on record for the community: the $23.6 million sale of 33 Strand Beach.
Few Days on Market
According to Reports on Housing, the inventory of luxury homes in Orange County is down 45% year-over-year, while demand is up 8%, and days on market is down to 51, from 101 days last year.
Last year’s low of 95 days on the market, reached in September 2020, was “the lowest market time level ever for homes priced above $1.5 million in Orange County, extremely hot for luxury,” Steven Thomas said in the report.
Reports on housing expect the definition of luxury homes to increase next year to local homes priced above $2 million.
Location is everything when determining what “luxury” means in OC’s housing market.
The average price for all single-family homes sold in September in Newport Beach, for example, is nearly $3.2 million, according to First Team Real Estate.
“Even though inventory is only half of what it was this time last year, there are significantly more sold transactions,” the brokerage said in an October report.
The report said September’s absorption rate––which compares the number of homes sold with the total number of homes for sale––was 77%.
“To put that in context, an absorption rate of over 20% is considered a seller’s market, and anything less than 15% is a buyer’s market,” the report said.
“There’s no question that we’re in the midst of an extremely hot seller’s market.”