Buffalo, N.Y. (WBEN) - Against the backdrop of higher interest rates, limited inventory and a cautious economic landscape, home buyers - especially those in the upper-end markets - have slowed down in their desire to move up into the $1 million-plus housing market.
The latest example: A two-bedroom townhome in the Rivermist development within Buffalo's Waterfront Village sold for $1.2 million, according to documents filed in the Erie County Clerk's Office. The 2,610-square-foot townhome, built in 1988, was initially listed for $1.1 million, according to Realtor.com data.
The deal marked this year's 66th private residence within Erie County to sell for more than $1 million, including 14 in the City of Buffalo. No homes in Niagara County have sold for more than $1 million, according to Niagara County Clerk's Office data.
So what gives?
Susan Lenahan, M.J. Peterson Corp. vice president, says it is a combination of factors leading to what is still a robust and active real estate market, especially in the upper end - any house sale $900,000 and above.
"Real estate remains a very good investment," Lenahan said.
While the region already has a tight marketplace in terms of current residential listings, the region's upper-end market is even tighter with a limited number of listings.
According to the Buffalo Niagara Association of Realtors’ multiple listing data base, the Buffalo Niagara region has 1,593 active listings. Of that, 76 are priced at $900,000 or greater, and 56 are listed at $1 million or more.
Between 2023 and Sept. 8 of this year, 206 private residences have sold for $1 million or more. Last year set a regional record with 83 homes selling for more than $1 million.
Based on current trends, it appears last year's record of 83 homes sold for more than $1 million could be tied or surpassed.
Why is the $1 million sales figure such a key benchmark?
Within the region's residential real estate industry, sales of homes that sell for more than $1 million are considered a key economic indicator representing the strength of the marketplace. It is widely viewed a major threshold.
"What it tells me is that we still have a strong market," Lenahan said.