In the midst of a pandemic, wealthy buyers are snapping up metro Phoenix’s million-dollar homes at a record pace.
Both Valley mansions and spacious condominiums with seven-figure price tags are selling, and many buyers are paying cash.
The trend has drawn a developer to purchase one of the poshest pieces of vacant land near The Phoenician resort to build 195 more million-dollar homes.
Buyers are both local and from out of state. Many are using LLCs to mask their names.
Last week, an LLC called Nauni Desert Property paid $18 million in cash for a Paradise Valley mansion. The seller was 612 Properties LLC.
A growing number of buyers bidding for too-few homes for sale is driving metro Phoenix’s median home prices to new monthly records. Low interest rates and a growing population are behind most home sales priced below $750,000.
But housing analysts are trying to figure out what is driving the surge in pricier home sales in the Valley.
“We are seeing a big influx of million-dollar home buyers from California, potentially looking to escape higher taxes,” said Tina Tamboer, senior housing analyst with the Cromford Report. “But we are also seeing wealthy buyers from Florida and Texas, and those states don’t have personal income taxes.”
High-end-home sales often track closely with stock market gains and losses because deep-pocketed buyers are affected the most by those swings.
But the trend isn’t tracking as strongly now.
The U.S. stock markets sank a bit in September when 371 Phoenix-area homes with price tags above $1 million sold, according to the Arizona Regional Multiple Listing Service.
That’s almost triple the number of million-dollar home sales in September 2019, when stocks were down just slightly from this year’s performance for the same month.
And buyers are willing to pay more for metro Phoenix mansions now. In September 2020, 27 houses priced above $3 million sold. That compares with three home sales at prices of $3 million or higher in September 2019.
More than 300 million-dollar home sales are currently pending in metro Phoenix.
Replay Destinations paid $65.5 million in early November for nearly 30 acres next to the posh Phoenician in east Phoenix at the base of Camelback Mountain.
The developer plans to build 195 houses with price tags starting at $1.78 million in a community called Ascent at The Phoenician.
Nathan & Associates brokered the deal, which is one of the biggest for luxury land parcels in the Valley.
The development “will offer buyers the rare opportunity to live at one of the region’s most prestigious addresses,” said Gary Raymond, managing director of Replay.
Several homes around the Ascent project recently have sold for more than $2 million, and one just across the Phoenician golf course is on the market for $8.2 million.
Support local journalism. Subscribe to azcentral today.