Affluent home buyers drove demand for beach getaways and outdoorsy communities, which reigned as the hottest luxury markets in the U.S. in the second quarter, according to the high-end cut of the latest Emerging Housing Markets Index from The Wall Street Journal and Realtor.com.
The luxury index is based on housing data for the top 10% of 60 U.S. markets, and takes into account information on the real estate market and other economic measures in order to rank the most active high-end housing markets.
Indicators include growth in housing supply and demand; median listing prices; a cost-of-living measure; small businesses; local property taxes; amenities; unemployment; wages; and the share of foreign-born residents—who contribute to the economic vitality and diversity of the area. In general, beach towns did especially well in the second quarter, but there were also some major cities in the mix.
At number five, the resort area of Hilton Head Island, Bluffton and Beaufort, South Carolina falls firmly in Hale’s beach-town category, with buyers seeking a waterfront lifestyle that often comes at a lower cost than in other areas of the country.
The area, which has dropped in the, offers amenities such as boating, golf, plenty of beaches and a warm climate. As of June, the overall median listing price in the area was $622,450, a 3.9% fall from the same time last year, according to data from Realtor.com.
South Carolina’s low country, as it is known, has a relatively low income tax, which appeals to incoming buyers who are retiring, as well as low property taxes.
On number four, Texas has been wooing buyers from across the country for some time, in particular thanks to its lack of income tax. The Dallas metro area, which has a population of around 7.76 million people, is no exception. Dallas’s unemployment rate is generally low, and combined with the city’s large size, it offers opportunities for working households.
The city is home to one of the busiest million-dollar markets in the country, with 22% of its listing inventory priced over $1 million, according to data from Point2.
St. Louis dropped to third place this quarter after taking the top spot in the ranking during the first quarter of the year. Despite the slip, it’s still experiencing strong demand and tight supply across the top end of the market, helped by an increase in corporate relocations and new residents drawn to the comparative value on offer.
Best known as part of the Silicon Valley tech hub, San Jose, Sunnyvale and Santa Clara, has shifted up the rankings to second place. Though home to a well-known and bustling tech sector, layoffs have proved to be a major hurdle in the industry of late.
At roughly $1.5 million, the overall median listing price in the area is one of the highest in the nation, according to data from Realtor.com, but its increases are slow, logging a rise of just 0.2% annually last month.
Up from third place last quarter, Boulder—a hot spot for outdoor enthusiasts because of its miles of walking, hiking and biking trails, as well as its proximity to the mountains—has now risen to first place.
Boulder, only 25 miles north of Colorado’s capital Denver, is “a very unique town.” It has that small-town feel, but it’s got the sophistication you don’t find in small towns. Average luxury prices—that is listings priced at $2.5 million and up—in Boulder rose annually in April, May and June, according to data from Compass. In June, the average sold price for a luxury home ticked up 9.4% from the same time last year to $3.9 million, the brokerage said.
