To underscore this low inventory, Duncan-Hart cites a client who sold his luxury home five years ago for around $650,000 before leaving the area. Now looking to move back to the area on a budget of $850,000, they continue to fail when it comes to finding housing.
“There’s nothing right now that I can show them at $850,000 that even compares to the luxury house I sold five years ago,” she said.
Years ago, a home that cost $1 million or more could typically stay on the market for four to six months, simply because the pool of buyers who wanted or could afford to buy at that price range was so small, Duncan-Hart said.
This is no longer the case.
“I’ve had three ads in the last 16 months (that were) all $1 million+ that sold like that,” she said.
A 4-bedroom, 4-bathroom, 5,121 square foot custom-built home in the 8200 block of Turning Leaf Crossing in Clearcreek Twp. sold for a whopping $975,000 in just five days last year with several offers on the table.
The number of homes selling for $700,000 and more in Montgomery County has increased from 28 in 2020 to 50 in 2021, according to Dayton Realtors.
But in the smaller Warren County, homes in that price range have fallen from 42 in 2020 to 78 in 2021.
Duncan-Hart says more homes are selling in the $700,000 price range in Warren County, in part because of lower property taxes. The owner of a million dollar home could pay around $12,000 in taxes each year there, unlike the owner of the same priced home in some jurisdictions in Montgomery County who pays around $20,000 a year. year, she said.
Homes are also selling for a higher price in Warren County due to newer inventory and the proximity of Dayton to Cincinnati, she said.
Warren County Auditor Matt Nolan said homes considered by some to be “starter homes” now often cost in the $500,000 range and are by no means luxury homes.
“These aren’t high-end finishes or things we associate with luxury homes,” Nolan said.
And sales of high-end, non-custom homes between $600,000 and $900,000 are “unbelievably hot” right now, he said.
It’s not that there aren’t cheaper homes in Warren County. Listings on Realtor.com on Thursday included dozens of homes under $250,000, though a good chunk of them were listed as “pending sale.”
Home price increases in the area are “a story as old as time,” which applies to almost everything, Duncan-Hart said.
“It’s supply and demand,” she said. “We don’t have any stock and it’s not that people don’t want to sell. I have many people who say ‘I’ll let you sell my house, but where am I going?’
Once there is greater supply, either by homebuilders building more homes or by more homeowners putting their homes on the market, prices will “level off”.
But Duncan-Hart said she doesn’t believe they will ever return to the levels they were at in 2018 or 2019.
“The problem is that people are willing to pay these higher prices for real estate because they have no choice,” she said. “There is nothing there.”
While there’s no set industry standard of a price defining a luxury home sale, the $700,000-plus range typically includes higher quality homes and more amenities, Duncan-Hart said. .
Those who buy luxury homes are usually in their 30s and older, she said.
“They’re already homeowners, they’ve outgrown (their house), their kids are growing a bit and getting closer to school and they want a bigger house before their kids start school, so they can put down roots,” says Duncan-Hart.
Those looking for such homes mainly find them these days in Springboro, Centerville, Washington Twp., Oakwood, West Kettering, Beavercreek, Bellbrook and Sugarcreek Twp., Duncan-Hart said.
But amid house shortages there, building new ones isn’t the easiest solution due to soaring property and building material prices, as well as longer waits for the building. completion due to supply chain disruptions, she said.
Rising interest rates, as expected, may mean that some young homebuyers won’t pull the proverbial trigger on buying a home as expensive as they could have spent with historically low interest rates.
When it comes to luxury homes, total square footage is not as important as location, build quality and the amenities one enjoys, she said.