When it comes to luxury million-dollar homes, the tech capital of Silicon Valley seems to be the new hot market, surpassing the traditionally favored markets lof Miami and Beverley Hills.
CNBC recently reported that this year alone, the sale of $1 million homes doubled in the Valley with 225 and 211 homes sold for $1 million and more in the markets of Saratoga and Burlingame.
“Silicon Valley is one of those hyper-local markets that are just very strong right now,” Daren Blumquist of Realtytrac told CNBC.
On what lures investors to the Valley, realtors say tech growth is one of the primary reasons. Besides, an increasing number of Chinese investors are also buying properties in the Valley considering it a safe haven.
Robert Gerlach of Alain Pinel’s Palo Alto office told CNBC that he recently sold a house in the Valley, which attracted eight bidders. Not surprisingly, seven of the bidders were Chinese.
“The Chinese buyers are telling me that this is a safe place to put their money and a good place for their kids, given the quality of the schools,” he said.
Not all million dollar homes sell
Elsewhere, homebuyers are struggling to sell their million-dollar homes. Recordonline.com reported that in Mid-Hudson, it is one of the slow-moving segments.
According to the website, when Don and Karen Walton listed their $1.18 million house in 2011, it drew three prospective buyers. But enquiries failed to translate into sales. To attract buyers, they reduced the asking price to $1.10 million, but are hesitant to reduce it further.
"If there's no activity, no interest and no market, there's no sense in going against yourself by dropping the price," Don told Recordonline.com. "And when the economy recovers, once you've dropped your price, you're finished, end of discussion."
A number of million-dollar houses have had to reduce their asking price to attract customers. A residence that was priced at $2.25 million when it was first listed in December 2010 is now in the market for $1.95 million; another house had its selling price reduced from $1.25 million to $949,000, the report showed.
"It's a very weak segment of the market," Ann Garti, chief operating officer of the Goshen branch of the Hudson Gateway Association of Realtors told Recordonline.com.
According to her, unemployment and cutbacks in the Manhattan financial industry has reduced the number of buyers looking for homes in the million dollar range.
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