The pandemic-era home price explosion was especially pronounced for luxury homes, but more than five years later, most of that growth has fizzled out.
In a new report, Realtor.com examined luxury listings around the country and found that outside of two unique markets, pandemic appreciation in the upper echelons of the housing market hasn’t been outdone in the years since.
Only Minneapolis-St. Paul and Boise have seen recent prices best previous highs, with luxury homes now sitting at 5% and 4% above their pandemic peaks, respectively. While Minneapolis-St. Paul’s luxury home prices only ticked up by 17.6% during the home buying boom, prices exploded by an astronomical 87% in Boise – and they haven’t fallen back down to earth.
Other luxury housing markets have held onto most of their massive pricing gains, even if they haven’t been able to top them. Boston and Bend, Oregon each retained 89% of their previous run-ups and don’t yet appear to have peaked. Boston’s luxury market continues to benefit from wealthy home buyers working in financial services and life sciences, Realtor.com’s report observes, while the well-to-do still flock to Bend’s outdoor activities and lifestyle appeal.
“The pandemic didn’t create the same luxury market everywhere, and the correction hasn’t played out the same everywhere either,” Realtor.com Senior Economist Anthony Smith wrote in the report. “Two markets have surpassed their pandemic peaks entirely. Five have fallen below where they started before COVID arrived. The ones still holding their gains have something the others don’t: real reasons for buyers to be there that have nothing to do with low mortgage rates and remote work.”
What goes up
On the other side of the coin, the Bay Area saw its pandemic luxury housing boom erased and then some. The deep market correction centered on San Francisco saw its price threshold for luxury homes retreat by nearly $700,000 under its pre-pandemic baseline. That makes the Bay Area’s negative trend the most dramatic of any of the tracked markets in Realtor.com’s report, which cites pandemic-era tech layoffs and an outflow of wealthy residents as the phenomenon’s underlying forces.
The same data suggests that the Bay may now be on the rebound. Affluent tech workers benefitting from the AI boom are cashing in and making bigger down payments for luxury homes, according to Realtor.com’s analysis. That “small but highly compensated AI workforce” is pushing demand on the high end of the market that is counteracting the Bay’s broader luxury housing price correction.
On a national level, some things have changed for good. Listings over one million dollars made up 13.8% of the U.S. housing market in May 2026, a much larger slice of the pie compared to 7% to 9% pre-pandemic. The so-called “luxury threshold” hovered around $1.28 million in May, designating the price where the top 10% of the country’s most expensive homes begin. The month marked the 26th consecutive dip for the luxury threshold, though the 1.4% decline is minor compared to bigger drops around 5% at the start of last year.