Austin Business Journal shares, "While the housing market is shifting — giving buyers a bit more leverage — luxury markets remained resilient in the second quarter in the face of sustained higher interest rates, longer time spent on the market and slower home-price appreciation.
That’s according to The Business Journals’ latest analysis of the country’s hottest housing markets, which analyzed ZIP code-level mortgage and real estate data provided by Intercontinental Exchange to determine the top luxury housing markets. The analysis was limited to ZIP codes that had an average sale price of $1.5 million or greater and a minimum number of listings sold of 10 during the most recent quarter.
The rankings aren’t meant to highlight the most expensive or the most popular markets, although some of those are on the list. Instead, rankings spotlight ZIP codes where activity is surging, prices are dramatically rising or homes are selling at a faster pace.
The nation's hottest luxury housing markets
Topping the list is Sunapee, New Hampshire’s 03782, which had an average listing price of $1.19 million. While listing prices in 03782 fell 42% from first quarter, the year-over-year loss was 16%.
California claimed 51 of the 100 hottest luxury markets and eight of the top 20.
As prospective buyers grapple with economic uncertainty, overall residential real estate inventory has ticked up in recent months and sale prices have subsequently cooled. However, luxury markets — identified as ZIP codes with an average home price of at least $2 million — tended to be more insulated.
Between the first and second quarters, average sales prices among the nation's hottest luxury housing markets increased only 0.4%. Year-over-year, that change was 5% and, since 2019, prices have grown 56%.
The overall residential market, meanwhile, saw a gain of 3% in sales prices compared to last quarter. The average sales price within the broader market is up 2% year-over-year but has grown 58% from pre-pandemic levels.
The 50 hottest luxury housing markets in America as of Q2 2025
Where luxury prices are surging
ZIP codes that have historically experienced the most substantial growth at the top end of the market have historically been near the nation’s largest metros or adjacent to tech hubs.
While pandemic-era migration hot spots in Florida and Arizona joined those ranks, the latter markets cooled somewhat in the second quarter. And, as aforementioned, California in particular had a strong showing during the most recent period.
Over the past five years, Los Angeles ZIP code 90020 had the strongest luxury price growth, at 277%. Home to the Miracle Mile and a hub of entertainment and retail, the ZIP code was No. 2 on The Business Journals’ Luxury Hottest Housing metric for the second quarter.
Average home-sale prices grew from $576,000 to $2.17 million in 90020. Over the past 12 months, that ZIP code maintained a 272% appreciation rate, followed by a 128% jump between the first and second quarter of this year.
Fellow Los Angeles ZIP code 90004 came in at No. 10. The Hollywood and Larchmont area showed a more modest bump of 39% compared to 2019 figures, with average sale prices growing from $1.5 million to $2.1 million. Year-over-year growth was 82%, while quarter-over-quarter saw a 20% increase.
Two ZIP codes from Newport Beach, California, also made the top 10 luxury list for the second quarter.
ZIP code 92661 experienced average selling price gains of 117% compared to pre-pandemic levels. Homes in that Orange County community sold for an average of $3.47 million in 2019, but that soared to $7.53 million during the same period in 2025. The tony coastal area posted an annual gain of 66% and grew 22% quarter-over-quarter.
Meanwhile, Newport Beach's 92663 ranked ninth on the the luxury market list, with six-year price growth of 128%. Home prices jumped from $1.9 million to $4.34 million during that period. Much like its Orange County neighbors, ZIP code 92663’s recent gains were more modest, at 31% and 36% for annual and quarterly growth, respectively.
Urban living beyond downtowns
While middle America and mountain towns saw an influx of pandemic-era in-migration in response to remote work, corporate return-to-office mandates have reversed momentum in some areas. But not all.
According to University of Toronto urbanist Richard Florida, this next wave of the evolving work landscape has given rise to the “Meta City,” where workers live in one city but commute semi-regularly to another as remote work and digital connectivity transform individual cities into urban centers.
While that may be good news for small towns and suburbs, the trend could further squeeze some downtowns as perceptions of “urban living” evolve.
Summer Perry, principal and broker at Compass-affiliated Summer Perry Group, is watching that play out in parts of Orange County, approximately 45 minutes outside of Los Angeles.
“We’re not seeing executives flock back to urban centers. In Orange County, Newport Beach is the urban lifestyle — walkability, fine dining, top-tier schools and proximity to John Wayne Airport make it ideal for executives who want both connectivity and a coastal retreat,” Perry said. “Instead of giving up space, many are choosing homes with dedicated offices, wellness amenities and flexible layouts to balance work and leisure seamlessly.”
Demand persists for lifestyle-driven living
Recent turmoil over tariff and trade policy has dampened consumer confidence. That, in addition to raids by U.S. Immigration and Customs Enforcement — especially in California — means demand from foreign luxury buyers has also waned.
“We’ve experienced some cooling from international buyers due to global economic shifts and visa restrictions but the domestic luxury buyer base in California is deep and extremely active,” Perry said. “Orange County, in particular, is fueled by local wealth creation in tech, health care and private equity, which has offset softer demand from abroad.”
She’s also bullish on Newport Beach’s growth as the demand for lifestyle-driven homes remains strong and turnkey new construction demands record price-per-square-foot numbers.
“While there is caution in certain segments, affluent buyers continue to view real estate as one of the safest and most lifestyle-driven investments they can make,” Perry said. “Instead of pulling back, many are consolidating into trophy properties or upgrading to homes with stronger long term value drivers — harbor frontage, ocean views or new construction.”"
Source: Austin Business Journal
Written by: Joanne Drilling
Published: September 10, 2025
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