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http://www.usatoday.com/money/econom...ets/50493406/1
By Michelle Conlin, Associated Press
By Michelle Conlin, Associated Press
Consider foreclosure-ravaged Detroit. In the historic Green Acres district, a haven for hipsters, a pristine, three-bedroom brick Tudor recently sold for $6,000 — about what a buyer would have paid during the Great Depression.
Yet just 15 miles away, in the posh suburban enclave of Birmingham, bidding wars are back. Multimillion-dollar mansions are selling quickly. Sales this August were up 21% from the previous year. The country club has ended its stealth discounts on new memberships. And Main Street's retail storefronts are full.
[..]
Then, there is the other housing market, occupied by 1.5% of the U.S. population, according to Zillow.com.
Here, houses have outdoor kitchens and in-home spas, his-and-her boudoirs and closets the size of starter homes. This market is not local but global, with international buyers bidding in cash. And the gyrations of the stock market are cause for conversation, not cutting expenses.
In this land of luxury properties, the Great Recession seems over. Prices of $1 million-plus properties have risen 0.7% since February, according to Zillow. Prices of houses under $1 million have fallen more than 1.5%.
Normally, these two segments of the housing market rise and fall together. Now, they're moving in opposite directions.
[..]
Wall Street's recovery has brought back the market for mansions in the Hamptons, on Long Island, where the number of real estate closings has returned to the 2007 level, and for luxury co-ops in New York City. And because of social-network riches in Silicon Valley, twice as many homes have sold for $5 million or more this year than last.
[..]
In Miami, a city that exemplifies the foreclosure epidemic, idle cranes dot the skyline. Unemployment shot up again this summer from 12% to 14%, a level not seen since the energy crisis in 1973. There are so many two-bedroom condos in gated communities with golf courses, private pools and jogging paths that you can pick one up for $25,000, 66% off the price five years ago. But luxury condos priced at $1 million or more are selling as rapidly as they did during the boom.
[..]
"Luxury properties are drawing buyers from all over the world," says CoreLogic's chief economist, Mark Fleming.
That's true even in such seemingly all-American enclaves as Detroit. Step off a plane at the city's futuristic new airport and the internationalization of the Motor City is obvious. All the signs — as well as the announcements on the public address system — are in both Chinese and English.
In the middle of the terminal sits a five-star Westin Hotel, the better to serve the global executive class that jets in and out as the U.S. auto industry regains its footing. Many of them are buying in Birmingham, Mich.,, where home values are up 3.1% this year, according to Zillow.com.
In Birmingham, store owners say business is as good as it was during the boom years last decade. Chasta Fase, who owns Old World Olive Press, a boutique shop that sells $30 bottles of olive oil from around the world, says business "has been just awesome" since she opened in November. And since April, she says, customers have been spending more than ever.
Real estate agent Keating says the same is happening to her sales. In June, she sold a lakefront mansion in Birmingham to a Russian entrepreneur. He had purchased a local steel company that he plans to turn around.
"They're coming from all over," says Keating, who for the past 30 years has sold most of the car barons their homes, from Roger Smith, former CEO of General Motors, to former Chrysler CEO Bob Nardelli. "I don't know who any of them are anymore."
Yet just 15 miles away, in the posh suburban enclave of Birmingham, bidding wars are back. Multimillion-dollar mansions are selling quickly. Sales this August were up 21% from the previous year. The country club has ended its stealth discounts on new memberships. And Main Street's retail storefronts are full.
[..]
Then, there is the other housing market, occupied by 1.5% of the U.S. population, according to Zillow.com.
Here, houses have outdoor kitchens and in-home spas, his-and-her boudoirs and closets the size of starter homes. This market is not local but global, with international buyers bidding in cash. And the gyrations of the stock market are cause for conversation, not cutting expenses.
In this land of luxury properties, the Great Recession seems over. Prices of $1 million-plus properties have risen 0.7% since February, according to Zillow. Prices of houses under $1 million have fallen more than 1.5%.
Normally, these two segments of the housing market rise and fall together. Now, they're moving in opposite directions.
[..]
Wall Street's recovery has brought back the market for mansions in the Hamptons, on Long Island, where the number of real estate closings has returned to the 2007 level, and for luxury co-ops in New York City. And because of social-network riches in Silicon Valley, twice as many homes have sold for $5 million or more this year than last.
[..]
In Miami, a city that exemplifies the foreclosure epidemic, idle cranes dot the skyline. Unemployment shot up again this summer from 12% to 14%, a level not seen since the energy crisis in 1973. There are so many two-bedroom condos in gated communities with golf courses, private pools and jogging paths that you can pick one up for $25,000, 66% off the price five years ago. But luxury condos priced at $1 million or more are selling as rapidly as they did during the boom.
[..]
"Luxury properties are drawing buyers from all over the world," says CoreLogic's chief economist, Mark Fleming.
That's true even in such seemingly all-American enclaves as Detroit. Step off a plane at the city's futuristic new airport and the internationalization of the Motor City is obvious. All the signs — as well as the announcements on the public address system — are in both Chinese and English.
In the middle of the terminal sits a five-star Westin Hotel, the better to serve the global executive class that jets in and out as the U.S. auto industry regains its footing. Many of them are buying in Birmingham, Mich.,, where home values are up 3.1% this year, according to Zillow.com.
In Birmingham, store owners say business is as good as it was during the boom years last decade. Chasta Fase, who owns Old World Olive Press, a boutique shop that sells $30 bottles of olive oil from around the world, says business "has been just awesome" since she opened in November. And since April, she says, customers have been spending more than ever.
Real estate agent Keating says the same is happening to her sales. In June, she sold a lakefront mansion in Birmingham to a Russian entrepreneur. He had purchased a local steel company that he plans to turn around.
"They're coming from all over," says Keating, who for the past 30 years has sold most of the car barons their homes, from Roger Smith, former CEO of General Motors, to former Chrysler CEO Bob Nardelli. "I don't know who any of them are anymore."
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