California luxury home prices plunge as properties continue to sell fast

California’s gold is going for dirt cheap.

The state’s luxury housing is getting more affordable — with million-dollar homes flying off the market.

Four California metro areas landed among the 10 markets with the biggest year-over-year drops in luxury home prices in July, according to a new Realtor.com report.

San Francisco led the California declines, with the threshold to enter the top 10% of local listings falling 8.6% to about $2.49 million. San Diego dropped 7.3%, San Jose fell 6.9% and the Oxnard-Thousand Oaks-Ventura market slid 6%.

And those California homes are moving fast.

Million-dollar properties in San Francisco sold in a median of just 37 days in July — the fastest pace among the luxury markets analyzed. San Jose wasn’t far behind at 38 days.

And San Jose remains the country’s million-dollar listing capital, with nearly 62% of its active listings priced above $1 million.

“A lower luxury threshold doesn’t necessarily mean demand has weakened,” Realtor.com senior economist Anthony Smith said. “In some markets, declining thresholds reflect prices adjusting after rapid growth. In others, like San Francisco and San Jose, Calif., homes are selling so quickly that inventory is turning over faster than it’s being replenished.”

Los Angeles is still one of America’s priciest luxury markets, with the top 10% of listings starting at nearly $4 million. The market’s luxury threshold nevertheless fell 3.8% from a year ago.

Nationally, the entry point for luxury housing dropped 2.7% to $1.25 million, marking the 29th straight month of annual declines.

Yet the wealthy are still buying. Luxury homes in the top 10% sold three days faster than they did a year ago, while ultra-luxury properties — the top 1% — sold five days faster.

“The national luxury market continues to normalize, but the forces driving prices vary significantly from one market to another,” Smith said.