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Final 2014 Numbers Show Big Luxury Market Surge in Colorado

Beautiful MansionContinuing the trend of upward growth that showed up in the fall of 2014, recent numbers demonstrate that the luxury market saw far more sales in December 2014 than was initially expected. The market had seen growth in both October and November but was expected to see a decrease in home sales during December due to the approaching holidays. Instead, the opposite occurred and the market seems to be booming in a big way.

A Strong December Surge

Generally, luxury home purchases tail off near the end of the year, largely due to the fact that the holiday season is so financially demanding. This year, that trend seems to have reversed. Across the United States, holiday shopping dropped by almost 1% over the same period 2013. However, luxury home sales in the Denver area rose from 51 in 2013 to an astonishing 81 in 2014. This represents growth of more than 58% and bucks many real estate trends. It also marks a large increase over November’s numbers, where 56 total homes were sold. This might be an indicator that people are investing long-term when it comes to luxury buying. What is certain is that this surge adds to several months of strong growth in the Denver area.

Prices Rise, Too

For the most part, prices in the luxury home market have remained the same in 2014 as they have in 2013, even decreasing in some areas. That changed in December, which saw an average price of $266 per square foot of real estate. This represented an increase of $41 over what the same time period in 2013 saw. Right now, this is only a one-month trend that needs more evidence in order to evaluate fully. However, if this turns out to be more than a momentary increase, this could signal some interesting things for the economy as a whole. The price increase could indicate that as the economy gets stronger people are more willing to spend a few extra dollars to get the homes they really want.

Possible Causes of the Surge

There are many possible reasons that the luxury home market is on the rise in the Denver area. For starters, it is quite possibly a direct result of Colorado’s growing popularity, since the state is one of the fastest-growing in the United States. Another factor at play may be the surging United States economy, which has been recovering over the course of several years. The idea that people were trying to push for a sale before the end of the year for tax purposes might have merit but seems less likely to be a full explanation, since this is a trend that has been building for many years now.

At its core, this news means that 2014 was a good year for luxury homes. The price increase in December might signify an improvement in the seller’s market, but it will take a few months for that to become a solid trend. This does demonstrate the power that the Denver area has on luxury buyers, as more and more people are interested in coming to the region.

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