Pity the millionaire: Mansions in short supply

As the US housing market rebounds and confidence builds, $1 million-plus homes are now scarce.

By Jonathan Berr Jun 17, 2013 7:21AM
Swimming pool (© Corbis)If you're lucky enough to be in the market for a mansion, be prepared to wait.

According to CNBC
, the U.S. is suffering from a mansion shortage. Housing inventory in the 90 wealthiest ZIP codes in the U.S. has fallen by 15% over the past year, according to a study CNBC cites from Atlas Research. Available homes selling for $1 million-plus have plunged by 70% in Palm Beach, Fla., and supplies are tight in Old Greenwich, Conn.

As tough as it is for the wealthy, this is good news for the overall economy. The National Association of Home Builders estimates that building an average new single-family home generates 3.05 jobs and $89,216 in taxes. Bigger homes, of course, have bigger economic footprints, as does remodeling. Applications for building permits hit a five-year high in April.

The surging U.S. real estate market is attracting investors from around the world. Americans are in a mood to buy as well, thanks to a higher stock market this year and rising consumer confidence. Housing prices soared by almost 11% year over year in March, the largest such monthly gain since 2008.

Some observers, however, are already worried that housing is in a bubble that's bound to burst.

"If prices keep going up at this rate for another six months, we will have a bubble, and people will get hurt," Dean Baker, a co-director of the Center for Economic and Policy Research in Washington, D.C., said in an interview with Bloomberg News.

People who now have to wait to find the home of their dreams should be thankful they don't have more serious problems.

Follow Jonathan Berr on Twitter @jdberr.

More on moneyNOW

139Comments
Jun 17, 2013 9:10AM
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How can this be?  Get congress on this problem, ASAP.  We can't have the super rich lving in the burbs! 

Jun 17, 2013 9:42AM
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Since the vast majority of us are middle-class citizens. Allow me  to politely ask MSN to keep this crap off of the news feed. 
Jun 17, 2013 9:28AM
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I just can't express in adequate words how sad and distraught I am over this. I'll be upset for weeks!  I have to go now...I need my antidepressants.
Jun 17, 2013 9:38AM
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They need to hire a lobbyist in Washington to work for they best interest. This is a disgrace. Some of these poor folks may have to settle for a 10,000-12,000 sq. ft. home. Were will the help live?
Jun 17, 2013 9:49AM
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Could we get some Habitat for Humanity teams on this right away?  A telethon, maybe?
Jun 17, 2013 9:53AM
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Oh those poor rich people.

What a shame that they don't have enough multi-million dollar, 15,000 square foot houses in gated communities for them so that they can live peacefully away from the commoners.

For shame......

Jun 17, 2013 9:40AM
Jun 17, 2013 9:42AM
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shortage because they keep going up in flames....just back from Colorado and all the very expensive homes you folks keep building to live in , in the mountains....wow....so everyones' insurance rates keep going up thanks to all of you with the million dollar plus homes in areas of extreme danger, ie; the mountain mansions...... so much freakin money in your dwellings and STUFF, so then the fires come, there goes your STUFF and the rest of us little shmoes see our rates rise and rise thanks to you all and your mansions and stuff getting more and more often destroyed in tornadoes, floods, hurricanes, fires......all your crap is messing up the rest of us, stop the madness, you don't need more mansions and stuff people, you need real values , for your sakes and ours. God bless America and save us, from ourselves.....what do you really value, your stuff or the eternal things that do matter ???!!!! 
Jun 17, 2013 9:27AM
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Yeah, I'm stuck in my HUD house until my mansion gets built.
Jun 17, 2013 9:39AM
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Awwwww!   Boo Hoo!  Guess they will have to have one custom built!
Jun 17, 2013 9:53AM
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But there will be trickle down, the Middle Class will eventually be able to rent out and live in their unused garage space.
Jun 17, 2013 10:13AM
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As a former Lender who once worked for a major bank and GOP PAC contributor... I can tell you that "estate" housing is kited. Homes are rarely listed outside a specific circle of Realtors, rarely financed outside a specific group of mortgage originators. We already know by FACT that estates do not enter the traditional default to foreclosure to repossession to auction process. A deep pocket is contacted and the house leaves the process early on. THINK about it... big homes are generally outside of the realm of business and commerce. Those communities are gated, heavily reliant on drive time and for Elitists who collude to keep their status. So far- the administrative roles that should have gone before the workforces are rock-solid and gaining wealth AND their dreamer estate homes are in low demand while the ACTUAL economy is literally destitute. Any odd thought of WHO got all that Bernanke QE? Any odder thoughts of how far these lowlife losers will go to ensure we keep floating them?

 

CASH OUT, kids. Watch the "pretty" people Twit their way to Oblivion. Sell hand baskets, they will be needed.

Jun 17, 2013 10:02AM
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I guess you can thank their overseas bank accounts and their 99 cents labor for this.
Jun 17, 2013 10:16AM
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The republicans have introduced an emergency funding bill to get the army corp of engineers to break ground asap.
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