Phoenix, Ariz.: According to sales data from the Information Market, 440 homes sold for $1 million or more in 2000. Amazingly, 2,000 homes sold in the same category during the first 10 months of 2006; 32 homes sold for $5 million or more.

Manhattan: The average price per square foot is $1,171 for a condominium, making the average purchase price more than $1 million. In the upper 10 percent of the New York market, the average sales price surged 18 percent in 2006 to $4.5 million.

California: According to the First Republic Prestige Home Index by First Republic Bank in Los Angeles, luxury home prices are up 12.8 percent from a year ago to a record $2.36 million. San Diego luxury home values have also climbed 6.4 percent to a record $2.14 million; and San Francisco has gained 4.8 percent, hitting a new milestone of $2.93 million.

Luxury home developers show no sign of throwing in the towel either. Chris Peterson, a developer in Ogden, Utah, is working with the city to buy the city's Mount Ogden Golf Course as well as an adjacent parcel of land from Weber State University. His plan? To build a subdivision featuring luxury homes surrounding a redesigned golf course.

In a recent interview with the Wall Street Journal, developer William Zeckendorf, who is building one of the most highly anticipated buildings in New York City, said, "From my vantage point, the super luxury market is as strong as I've seen it."

Toll Brothers, the nation's leading builder of luxury homes, is also pressing forward with several new projects.

Interestingly, the continued strength in luxury housing doesn't end at the border. In London, Ontario, luxury downtown apartments and condos are a favorite, according to Derek Anderson, president of the London Home Builders Association. He points out that aging baby boomers are the most likely buyers for these units.

Baby boomers, a 78 million strong demographic tour de force, have become the target market of choice for luxury home builders, developers and real estate agents. They have discovered that almost one in four boomers, or roughly 19 million of them, have a net worth of $500,000 or more, and this is expected to rise as the generation ages.

The iconic Del Webb retirement development company has seen this trend as well, and few companies are better at anticipating boomers' evolving housing needs than Pulte's Del Webb division, the nation's biggest builder of retirement homes. In its newest active retirement community just outside of Phoenix, the focus is on so-called "soft amenities" like cooking classes, yoga and even "adventure programming" that includes white-water rafting and skydiving.

"Boomers want to enjoy life, and they should," said the Luxury Home Council's Spalding. "They've earned it!"