Why Luxury Home Sales Are Surging Right Now

A new Redfin report shows soaring luxury home sales with prices hitting all-time highs, despite an otherwise mixed housing market.

A wealthy couple sits by a pool
(Image credit: Getty Images)

Luxury home sales are surging, with prices hitting all-time highs, according to a new report from Redfin. A typical U.S. luxury home sold for a record $1.17 million in the fourth quarter of 2023, up 8.8% from the same period a year earlier. The Redfin report defines luxury homes as those estimated to be in the top 5% of their respective metro area based on market value.

Redfin, a real estate brokerage, also showed that although high mortgage rates are having a chilling effect on the rest of the market, luxury home prices are rising because so many affluent buyers can buy homes in cash. In fact, nearly half, or 46.5%, of the fourth quarter’s luxury purchases were made in cash. That’s up from 40% a year earlier.

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Kathryn Pomroy

For the past 18+ years, Kathryn has highlighted the humanity in personal finance by shaping stories that identify the opportunities and obstacles in managing a person's finances. All the same, she’ll jump on other equally important topics if needed. Kathryn graduated with a degree in Journalism and lives in Duluth, Minnesota. She joined Kiplinger in 2023 as a contributor.