A recent report revealed sales of multimillion-dollar, single-family homes on the Long Island Sound are increasing throughout Fairfield and Westchester counties ”” with some coast locations even doubling in the number of luxury homes on the market year over year ”” into the third quarter.
The study was conducted by William Pitt and Julia B. Fee Sotheby”™s International Realty and assessed waterfront homes worth more than $1 million in the two counties. Both unit sales and dollar volume increased in the first three quarters of the year compared with the same period last year, according to the luxury residential real estate company, which has offices throughout the region.
“Unusual circumstances kept people from buying these homes. Now waterfront homes are back on the market, and the average prices have increased,” said Paul Breunich, president and CEO of William Pitt and Julia B. Fee Sotheby”™s International Realty.
Those unusual circumstances were back-to-back storms that made waterfront homes in Fairfield and Westchester counties less attractive to buyers. Those homes became vastly undersold.
But with President Barack Obama signing into law the Homeowner Flood Insurance Affordability Act of 2014 in March, subsidized flood insurance rates have gone down for coverage that was considered by some to be costly. Those discounted rates coupled with a stabilizing housing market have contributed to the resurgence of luxury waterfront homes, the report said.
“This year, due to FEMA”™s flood insurance getting clarified and adjusted to where it”™s more affordable for people to get flood insurance, that law contributes to waterfront homes having more demands hence there are more selling,” Breunich said.
Fairfield County”™s shoreline markets, including Greenwich, Stamford, Darien, Norwalk, Westport and Fairfield, experienced a 73.1 percent overall year-over-year increase in sales volume. Greenwich had the most noticeable improvement, with a dollar volume increase of 294.6 percent and unit sales that rose 166.7 percent from last year.
Meanwhile, Westchester”™s shoreline markets, including Rye, Larchmont, Mamaroneck and New Rochelle, saw unit sales grow 33 percent from the first three quarters in 2013 to the same period this year. Dollar volume grew by 44.2 percent, with Rye and Mamaroneck leading in highest net-worth homes.
The luxury housing market is also growing robust on a national level, according to a recent Coldwell Banker International report. Greenwich was mentioned as a leader in luxury homes valued at $5 million or more, ranking third behind New York City and Miami Beach.
Across the nation, the demographics of luxury homebuyers are slowly shifting to a more tech-savvy generation under the age of 35, the report stated.
Nearly half of the respondents who contributed to Coldwell Banker”™s national market report said they plan to purchase a luxury home in the next 12 months, with personal use outpacing investment interest by a 3-to-1 majority.
Buyers under 35 are more intent on purchasing, with 81 percent planning to buy a luxury home next year. The youngest buyers were the biggest spenders, paying $7.8 million on average for their last home, compared with $6.8 million for buyers between 35 and 44 years old, the report showed. On average, buyers between 45 and 64 years old paid $2.7 million, while buyers 65 and older paid $1 million.
When evaluating whether location is an important consideration in a homebuying decision, 75 percent of the luxury homebuyers under 35 said it didn”™t greatly affect their buying decision. With convenient travel options and the ability to work remotely widespread, young wealthy buyers aren”™t tied down to a particular geography. Meanwhile, 86 percent of homebuyers 65 and older said location is the single most important factor in determining which luxury home they purchase.
