(The Center Square) – Jacksonville and Chicago have more high-income households than in 2019, and more luxury buyers than a year ago but fewer homes for sale, creating an opening for builders despite high mortgage rates.
In Jacksonville, the estimated luxury buyer pool grew 10.4% from a year earlier while active luxury listings fell 9.4% and new luxury listings declined 8.8%. Chicago had 10.5% more buyers, 10.7% fewer active listings and 4.1% fewer new listings. In both markets, more buyers are competing for fewer homes, and fewer listings are coming to market. For luxury home builders, that mismatch deserves attention.
These are my estimates using Redfin housing data. Redfin defines luxury as the most expensive 5% of homes locally.
This week, the NAHB Housing Market Index and housing starts will help assess the broader construction outlook. I’ll be watching whether buyer traffic improves, how heavily builders rely on incentives, and whether single-family construction holds up.
Nationally, builders are struggling. September’s NAHB confidence index stood at 32, compared with 68 in September 2019 and a neutral benchmark of 50. Buyer traffic registered 23, versus 50 in September 2019. These are sentiment indexes, not buyer counts. Meanwhile, 66% of builders offered sales incentives, up from 63% in August.
My September housing report shows pending sales down 8.6% from a year earlier. Active listings reached 1.51 million, the most since March 2020. More choices do little for families unable to afford the payment.
That’s the broad market. At the top, buying power has grown.
New wealth from the AI boom and record stock prices helps explain the gap at the top. State and local policies can play a role in explaining differences across the country.
UBS estimates America added approximately 441,000 millionaires in 2025, more than any other country, compared with 379,000 it reported adding in 2024. Using Census data, I estimated that 19.4 million households earn at least $200,000 annually in 2024 dollars, up 23% since 2019.
My July-August housing report shows luxury demand proving more resilient as financing costs rose. Still, income growth alone does not establish that people are shopping. Since 2019, Austin’s high-income household count rose about 59%, but its luxury buyer pool fell 22% while active listings increased 20%.
Jacksonville and Chicago show where purchasing power meets limited supply. Using Census data and my model, I estimate that the number of households earning at least $200,000 annually, in 2024 dollars, increased 47% in Jacksonville and 14% in Chicago since 2019. More of them are shopping, too: the luxury buyer pool grew but home listings remain scarce.
My 2027 luxury forecast ranks Chicago seventh for buyer competition. Seven of the top 10 markets are in the Midwest.
Seattle offers a caution.
In the 12 months through August, Seattle’s luxury buyer pool declined about 14% while active listings rose 9%. San Francisco moved in the opposite direction: its luxury buyer pool grew about 10% while listings fell 11%. San Francisco ranks third in my 2027 luxury housing forecast.
Seattle’s housing market faces at least two major headwinds.
First, uncertainty over the Trump administration’s $100,000 fee on certain new H-1B petitions, currently blocked in court, could complicate recruitment of highly paid technology workers and potential homebuyers. Second, Washington’s new 9.9% tax on income above $1 million, set to begin in 2028, could make competing locations more attractive to affluent households.
On Nov. 3, voters will decide Initiative 645, which would repeal that tax and prohibit state and local individual income taxes while keeping the tax breaks passed alongside it. Tax differences can influence where some high earners choose to live.
The opportunity for home builders is to follow active buyers, especially in markets with limited inventory. Jacksonville and Chicago are pockets of opportunity in the luxury segment of the housing market.