Richmond Real Estate: Million Dollar Homes Market Update

March 18, 2009

Richmond million dollar homes market up-date

An analysis on the housing market for Richmond’s million dollar homes for the first 2.5 months showed that this market segment followed the rest of the Richmond real estate market. Home prices for this high-end market segment however held on relatively well as compared with the older resale homes. View million dollar homes listed on MLS here.

Million dollar homes selection criteria

The homes selected were limited to those under 5 years old, listed and sold within the $1 to $3 million price range. The following table summarized the data and the year-over-year comparison revealed some interesting information.

Time Period Jan 1 to Mar 15/08 Jan 1 to Mar 15/09
No. Units 22 17
Days On Market 47 65
Av. List Price (LP) $1,378K $1,435K
Av. Sale Price (SP) $1,314K $1,272
% Var. LP /SP -5% -11%
Av. City Value (CV) $1,124K $1,137K
% Var. Av. SP/CV +15% +11%

The days on market showed that the slower market had resulted in these homes taking up to an average of 65 days to sell. At the time of this analysis done on March 18, 2009 there was 94 homes within the $1 to $3 million price range listed for sale in Richmond. Based on the average sales of 8.8 homes per month for the 2.5 months of 2009, the list to sale ratio worked out to 10.7 months.

Market price and city value

When homes sold in the above study was compared with their city assessment values for 2009, these homes were found to be selling at 15% and 11% above city values respectively. The rate of price decline for these homes were relatively small compared with older homes that were found to be selling at 4% to 7% below city values.

Market Outlook over the next few months

Home sellers are adjusting their selling prices in response to the softer housing market. Compared to similar new homes that could fetched over $1.4 million a year ago, these homes are now selling at $1.2 to 1.3 million price range.

The soft market also resulted in building lots selling at much lower prices now. Building lots that used to sell in the $700,000 to $800,000 range are now adjusting to much lower prices below $650,000.

Prime building lots with older homes are selling well at prices around $550,000 to $600,000. Home builders are keen to buy such properties as holding properties, and they may hold off building new homes until they are more comfortable that they can make a profit building new homes for sale.

Follow this link to view Richmond million dollar homes listed for sale on the MLS System.


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