The Biggest Drop

Kahului-Wailuku, Hawaii recorded the sharpest luxury price drop. The entry point to luxury fell nearly 20% year-over-year to $3.79 million.

"The market has definitely cooled over the past couple of years," says Leslie Mackenzie Smith, a longtime agent with Hawai'i Life. "Inventory has increased slightly, and prices have softened."

Hawaii was among states that experienced a post-pandemic boom. Remote work flexibility and lower interest rates drew a wave of buyers to the area.

Luxury homes saw their fastest growth in August 2021, surging 87%. Prices peaked at $7 million in August 2023. Since then, values have steadily declined to $3.8 million, about 46% below the all-time peak.

Other Big Declines

Charleston, SC saw luxury thresholds drop 13.1% to $1.99 million. Atlantic City, NJ fell 13% to $2.32 million.

These metros can be described as pandemic-era boom towns or high-volatility resort destinations where prices overheated in recent years.

The National Picture

Eight of the 10 most expensive luxury markets posted annual price declines in October.

Despite the price drops, luxury homes sold faster than last year across most tiers. The 90th percentile moved three days faster year-over-year.

The national benchmark for luxury homes slipped 1.6% to $1.22 million in October. That's down 2.2% from a year ago.

High-end luxury tier (95th percentile) dropped 2.1% year-over-year to $1.95 million. Ultra-luxury (99th percentile) remains 3.3% lower than one year ago at $5.41 million.

The Buyer's Market

"Right now many of my luxury clients are actively watching for strong buying opportunities," Leslie Smith says. "With a bit more inventory and less competition, they feel like the timing is improving."

Luxury clients focus heavily on "ocean views, privacy, and strong indoor-outdoor living." Many want gated settings or homes that feel like a retreat.

Turnkey properties with contemporary finishes remain especially attractive. Most luxury buyers want to enjoy the lifestyle immediately, not take on renovations.

The Florida Exception

North Port-Bradenton-Sarasota, Florida stands out. With a luxury entry point of $1.67 million, the area saw nearly 20% more homes with top 10% listing prices over the last year.

"The Gulf Coast has long been a hot spot for luxury homebuyers, especially retirees," says Anthony Smith, senior economist at Realtor.com. "The region offers year-round sunshine, warm temperatures, white-sand beaches, and calm Gulf waters."

The Gulf Coast growth outpaces all other metros by a considerable margin.

The Bottom Line

Luxury home prices fell in eight of the 10 priciest markets with Hawaii's Kahului-Wailuku plunging 20%, creating buying opportunities in pandemic-era boom towns while Florida's Gulf Coast bucked the trend with nearly 20% inventory growth.