July 2018 was a slow month on all fronts, especially in comparison to past years.  The last week of the month saw a slight uptick in contracts signed but a majority of those came from “new developments” and the days on market for those properties were markedly up.  Sellers are really needing to price conservatively right now and even then must show patience and be open to both reducing prices further and negotiating down.  We have taken a majority of our listings off the market for August (as is our typical strategy) with the plan of relaunching in September post Labor Day.  We are interested to see what September brings but would not be surprised at all if the summer slow-down leads to a more significant drop in the market.  We cannot predict what is to come but for those sellers who really need to sell in the near future, we are strongly suggesting they come to market with tempered expectations and a conservative approach.  On the flip side, our buyers have been fairing quite well, able to negotiate on interesting property when they can find realistic sellers.  It is a full “buyers market” right now and as such we are finding deals can only get done when sellers are willing to acknowledge this new order.

Global Market Update

Jeremy and Robin are members of the Global Real Estate Partners initiative, which is comprised of Sotheby's International Real Estate’s finest professionals in every key market around the world. Currently spanning over 30 markets, this global partnership allows for unprecedented access to real estate resources worldwide. We've asked our fellow Global Real Estate Partners to share with us their thoughts on the current state of the market in their respective areas.

“San Francisco continues to be the nation’s most imbalanced luxury real real estate market, characterized by highly constrained inventory levels at the entry level, $4-7M and $8-12M ranges.  Vibrant demand continues from buyers relocating to the Bay Area for finance and technology industries, as well as vacation homes.  A high watermark ultra-luxe condominium sales price has reached $4,700/sf, however the average is nearer to $2,000/sf.” - Gregg Lynn, San Francisco 

"The new (or newly renovated) construction luxury condominium market in Chicago is faring quite well right now with record prices and abundant sales. There are multiple buyer pools (families, empty nesters, secondary home owners) feeding into this property type so demand is high. The luxury single family home market has been a little more tepid as of late as some buyers are sitting on the sidelines watching to see how the city’s political landscape unfolds and deciding whether to make a large home purchase in the city, or relocate to the suburbs or elsewhere." - Timothy Salm, Chicago

"The Dallas market home prices are now at record levels - up more than 40% in the last four years, with Fortune 500 companies continuing to move to the DFW area. Upper price points continue to stay strong with the driving force being new construction. We are seeing lots of urban development, high-rise and mid-rise living are becoming more and more popular because of the walkability to everything from the grocery store to five star dining." - Becky Frey, Dallas

"The ongoing trend in the Santa Barbara & Montecito area is that we are seeing an improvement in the luxury market. Oceanfront and big ocean view properties are selling quickly. We’ve already had 8 sales over $10 million, with two of those sales at $34 million and $35 million. In 2017, there were a total of 12 sales over $10 million. In 2018, Montecito has enjoyed 62 sales since June 30th with the average home sold at $4,569,016 and the median at $2,812,500. Overall, due to the 1/9 Montecito Debris Flow, any listings in the exclusion zones, or in high-risk areas will present an ongoing challenge to price and to sell. Sales YTD are not too far behind 2017’s statistics, so we’re optimistic that sales are on track, and hope that Montecito continues to enjoy sales with the lure of lower home prices." - Suzanne Perkins, Santa Barbara

"With quality inventory declining, buyers are willing to pay a premium for the right property. High net worth buyers are looking to establish WY residency for our favorable tax climate and of course, to enjoy the Jackson Hole lifestyle. While the dollar volume for 2018 has remained almost the same when compared to the same period in 2017, transactions are up 22% and inventory levels are down 21%." - Brandon Spackman, Jackson Hole