Luxury Home Sales Hold Their Own In Down Housing Market

The housing market is in a bit of a funk and home prices are not rising as fast as they did a year or so ago, but the outrageously expensive home market is alive and well, at least according to the Institute for Luxury Home Marketing which issued a recent press release on the state of the top tier of American homes as well as those in the larger world.

The Institute is a membership organization for real estate sales agents (Realtors® and representatives of National Association of Home Builders members only) who work in the top-level residential markets around the world. Upper tier is defined by the Institute as the top ten percent of sales as defined by price range in a given market or $500,000, whichever is higher. The Institute offers training in luxury home marketing and awards the Certified Luxury Home Marketing Specialist designation to agents who meet performance standards in that market. The Institute promotes its members to affluent homebuyers and sellers and conducts research in the luxury market.

The Institute is headquartered in Dallas, Texas (of course,) and has 4,300 members world-wide. At the beginning of 2006 it claimed that its members had 33 listings totaling $404 million on Unique Home Magazine's then current list of the highest priced properties in the United States.

The Institute's New Year press release said that the most expensive house sold in 2006 was in Alpine, New Jersey, about five miles from Manhattan. The English-style 10,000 square foot mansion on 63 acres with pool, tennis courts, and guest cottages sold for $58 million to the CEO of Advanced Photonix Richard Kurtz (the seller was Henry Clay Frick II.) While the largest sale last year it did not approach the all-time U.S. record set by the Palm Beach Florida oceanfront estate of Financier Ronald Perelman and his ex-wife actress Ellen Barkin. That sale, closed in 2005, brought in $70 million and was followed by a well publicized sale of millions of dollars of the jewelry given by Perelman to Barkin. Didn't see the house but if it was as over-the-top as the jewelry...

There were at least 10 buyers who had the desire and the means to pay $28 million dollars or more for houses in the U.S. last year.

"Strong corporate profits, good news on Wall Street, and a global commodities boom helped grow fortunes and sparked a surge of demand for trophy homes in 2006," said Waco Moore, Vice President of The Institute for Luxury Home Marketing. "Final numbers aren't in, but estimates are that the US's 2006 sales of homes priced at $5 million and above were up about 11% over 2005.

"Record Wall Street bonuses will jump-start 2007 luxury sales in New York," predicted Moore, "and, we'll see spillover into other markets as well."

"Fabulous homes are just one example of the luxury goods and services which are in demand," said Moore. He cited record art house sale records and waiting lists for custom built yachts and private planes. "Around the world, from Russia to Great Britain," he said, "there is a super rich group with wants, needs and the wealth to satisfy those desires."

The current list of the world's millionaires includes 793 names, an increase of 18 percent over the total in 2006.

Maybe one of these will break the Perelman U.S. record. Donald Trump is offering a "decorator-ready" Palm Beach, Florida home for $125 million. We assume that decorator-ready means "window treatments excluded." $100 million will buy the keys to a waterfront estate on Lake Tahoe, or if more exotic locations appeal there is another $100 million property on the Bosporus Sea in Istanbul.

The world record home sale remains a $125 million London mansion sold in 2004 to steel magnate Lakshmi Mittal, but a Saudi prince is offering his Aspen, Colorado home for $135 million and Updown Court in Windlesham, England (near Windsor Castle) is now on the market with an asking price of $139 million. Even the Queen might be willing to stop by for tea in this 103 room house with five pools, and a heated marble driveway.

Oh, and it was built on spec.