42. Sales of Luxury Homes Dropped 16.3%; Most Affordable Homes Sales Rose 11% Year-Over-Year

Sales of Luxury Homes Dropped 16.3%; Most Affordable Homes Sales Rose 11% Year-Over-Year

SEATTLE--Thursday, 27 January 2022--(BUSINESS WIRE)-- (NASDAQ: RDFN) — Sales of the most affordable homes in the U.S. rose 11.3% year over year in the fourth quarter of 2021, according to a new report from Redfin (www.redfin.com), the technology-powered real estate brokerage. Meanwhile, sales of luxury homes dropped 16.3%.

Sales of affordable homes are on the rise as the job market strengthens, especially for lower-wage workers, and real estate investors buy a record share of U.S. homes. At the same time, inventory in the most affordable price tier is up as the end of pandemic-driven mortgage forbearance and foreclosure moratorium policies encourages Americans to put their homes on the market.

“The market for homes at lower price points is booming for a few reasons. Not only is there demand from workers who are now earning higher wages, but investors, who have an appetite for lower-priced homes, are buying up properties at record rates,” said Redfin Chief Economist Daryl Fairweather. “And with the end of both mortgage forbearance and the foreclosure moratorium, many homeowners who don’t have much cash in the bank are choosing to sell their homes to clear their mortgage debt, providing plenty of supply to meet the high demand.”

For luxury homes, the big year-over-year sales drop is partly due to a surge during the fourth quarter of 2020, when affluent Americans took advantage of low mortgage rates and remote work to buy high-end homes. Sales are also constrained by a lack of supply. Luxury sales are still elevated above pre-pandemic levels—sales were up by nearly 27% from the last quarter of 2019 to the last quarter of 2021—but the initial pandemic-driven frenzy for high-end homes is calming down.

Redfin media release continues in the We Get Around Network Forum (www.WGANForum.com)