Luxury home prices in the US have fallen for 31 consecutive months, but Florida is defying the national downturn as wealthy newcomers drive demand and the supply of high-end properties shrinks.
Figures from Realtor.com show the national entry point for luxury housing — the asking price marking the top 10% of listings — fell 2.3% year on year to $1,197,014 in October.
The declines were sharper higher up the market. The threshold for the top 5% of listings dropped 4.1%, while the top 1% fell 6.2% to about $5.1 million.
Florida was a notable exception. The luxury threshold in the Miami-Fort Lauderdale-West Palm Beach metropolitan area rose 4.1% to roughly $2.3 million, while Naples recorded a 9% increase to about $3.75 million.
Only 12 of the 43 metropolitan areas analysed saw luxury prices rise by at least 1% over the past year. Five of them were in Florida: Naples-Marco Island, North Port-Bradenton-Sarasota, Cape Coral-Fort Myers, Miami-Fort Lauderdale-West Palm Beach and Tampa-St Petersburg-Clearwater.
Naples recorded the biggest increase in the country and was the only one of the ten most expensive luxury markets where prices rose. Its most expensive listings also sold a median of 27 days faster than they had a year earlier.
Anthony Smith, senior economist at Realtor.com, said million-dollar property listings were shrinking in most of Florida’s rising markets. “That smaller pool of available homes may be helping support prices, even as luxury thresholds fall nationally,” he wrote.
Why Florida is attracting the ultra-wealthy
Florida received a net $137 billion in income from other states between 2019 and 2023, as wealthy Americans continued to move there. The inflow increased further as billionaires relocated ahead of proposed wealth taxes in California and Washington.
Jeff Bezos, Ken Griffin, Mark Zuckerberg, Larry Page and Sergey Brin are among the billionaires to have spent hundreds of millions of dollars on estates in South Florida. The state’s lack of income tax, lifestyle and business environment have all been cited as reasons for its appeal.
Griffin moved his hedge fund from Chicago to Miami in 2022 and that year paid $106.9 million for an estate in Coconut Grove. Raffles is now developing 35 homes in the enclave, with prices starting at $4.5 million.
Amazon founder Bezos has spent $237 million on three properties on Indian Creek, the island known as “Billionaire Bunker”. A Delaware limited liability company reportedly linked to him also paid $69.5 million for an oceanfront estate in nearby Golden Beach in September.
Mark Zuckerberg and his wife, Priscilla Chan, bought a $170 million estate on Indian Creek this year, while Google co-founder Larry Page spent about $173.4 million on two properties in Coconut Grove.
Camilo Miguel Jr, founder and chief executive of Mast Capital, one of the partners involved in the Coconut Grove project, said: “We don’t really play in the middle market. We continue to see tremendous amounts of wealth moving into Florida, especially South Florida.”
South Florida luxury property adviser Michael Martirena said buyers spending between $20 million and $50 million were attracted by “no state income tax, the lifestyle, and the business climate”.
Under Florida’s newly approved Amendment 3, the annual cap on increases in taxable value for second homes will fall from 10% to 5%. Experts said the change would have the greatest effect on wealthy owners with several properties.
Elsewhere, luxury markets are continuing to retreat from the gains made during the pandemic, when prices rose rapidly over roughly two years. A June Realtor.com report found that, by May, the typical luxury market had retained 59% of that increase.
In October, the luxury threshold fell 12.1% year on year in San Jose, 11.3% in New York-Newark-Jersey City and 7.1% in San Francisco. Realtor.com has attributed San Francisco’s decline primarily to technology-sector layoffs, people leaving the area and a smaller pool of buyers.
