The $1 billion price cut: Luxury real estate gets slashed

The $1 billion price cut: Luxury real estate gets slashed


  • The high-end real-estate market has seen steep price cuts in recent months as foreign buyers dry up andnew tax laws kick in.
  • The Ziff family estate in Manalapan Florida cut its price in May by $27 million, from $165 million to $138 million.
  • Even the Oracle of Omaha, Warren Buffett, has had to lower his asking price on his beach home in Laguna Beach.

The most expensive real-estate in America just became a little less expensive — with $1 billion in price cuts among America's top listings over the past few months, according to a CNBC analysis.

The high-end real-estate market has seen steep price cuts in recent months as foreign buyers dry up, new tax laws bite the wealthiest states and sellers realize the market peak of 2014-2015 isn't coming back anytime soon, luxury brokers say.

According to RedFin, the real-estate brokerage and research firm, fully 12 percent of homes listed for $10 million or more saw a price drop in 2018 — double the levels of 2016 and 2015. Just over 500 listings in the U.S. had a combined price cut of $1 billion in the second quarter, according to RedFin.

"Prices were growing too fast for what buyers were willing to pay," said Taylor Marr, a senior economist at RedFin.

Some of the price cuts have reached tens of millions of dollars, according to the listing. The Ziff family estate in Manalapan Florida cut its price in May by $27 million, from $165 million to $138 million. That follows a previous price cut, from $195 million last year — so it's price has dropped by $57 million over the past year.

A 10-bedroom mansion on Miami Beach's posh Star Island cut its price by $17 million in May, from $65 million to $48 million. A giant apartment at New York's Sherry Netherland had its price cut by $18 million, falling from $86 million to $68 million.

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