Coming Soon: More Luxury Homes on the Market?
The trend could potentially deal a blow to the housing market, as it did in 2010 when affluent homeowners were worried that Congress would raise the capital gains tax. At the time, sellers flooded the high-end market with supply, pushing down home prices, CNBC.com reported.
Marolia said that he expects the supply of luxury homes to increase partly because of the pending tax increases, but even more so because of the growing perception that home prices are on the upswing. He said that should coax more homeowners to put their homes up for sale.
Other experts have said that the luxury market has reached a crossroads, where sellers who previously withheld their homes from the market in the hope that prices would rise have now given up on substantial appreciation.
So far this year, the supply of $1 million-plus homes has increased 15.7%, RealtyTrac reported.However, both Lance and Katzen said there's more than enough demand to offset any downward pressure on prices created by swelling inventory. "We have so many buyers sitting on the fencepost right now," Lance said.
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