Luxury real estate—while part of the housing market—is a world of its own, fighting the tides of market challenges and managing to stay afloat. Due to this, luxury consumers remain more positive in their market than most. In fact, over one-third of surveyed luxury consumers feel that 2024 will be a better time to buy or sell a home compared to 2023—indicating enthusiasm for luxury real estate as they pursue their dream home, according to a new report from Coldwell Banker Global Luxury.
Coldwell Banker Global Luxury’s The Trend Report features fresh insights from luxury consumers and identifies the top trends dominating the global luxury real estate landscape, backed by additional insight and data from Coldwell Banker Global Luxury Property Specialists, the Institute for Luxury Home Marketing and Wealth-X.
The report found that luxury market sales during Q4 2023 saw an increase of nearly 4.2% for single-family homes and 14.2% for attached properties, while new listings also increased by 14.2% for single-family homes and 7.2% for attached properties.
In addition, the top six themes shaping the 2024 luxury real estate market identified by the report are: shifting out of neutral; influences on the luxury market; have-it-all properties; the influence of AI; the high earners; not rich yet (HENRY) factor; foreign buyers and smart homes.
Key highlights:
- America continues to be a real estate safe haven for many of the world’s wealthiest and influential consumers. International buyers purchasing real estate in the top 5% of the market in 2023 saw 25% growth, indicating that international high-net-worth consumers continue to see the value of investing in the U.S. luxury real estate market.
- The top international buyers are from China, Canada and the United Kingdom, and the most favored cities to purchase within the U.S. are New York, Los Angeles, Miami, San Francisco and Washington, D.C.
- While international buyers look to America for their next property, wealthy Americans are also exploring opportunities abroad, with nearly 40% of survey respondents planning to buy a home in a foreign location within the next year, and two-thirds of affluent consumers saying they plan to purchase a home abroad within the next five years.
- Europe is the top destination among luxury consumers (29%), followed by North America (28%) and the Caribbean (23%).
- Social media is overwhelmingly influencing luxury consumers to purchase their dream home. A whopping 73% of affluent consumers say they have been influenced by social media to purchase a particular home they desire. Specifically, 64% of consumers aged 18 – 24 have felt this influence.
- Instagram (45%), YouTube (45%) and TikTok (44%) are the top social media platforms that have influenced luxury consumers to purchase their dream home.
- For the younger generations like millennials and Gen Z, TikTok has become an especially popular platform to connect with real estate agents. In addition, 68% of consumers in this age bracket are most likely to have been influenced by TikTok in their decision to purchase their desired home.
- While high interest rates and low inventory may cause some consumers to settle or pause their home search altogether, luxury consumers have only become more selective when purchasing their newest property.
- Notably, the top three amenities desired by luxury consumers according to the survey findings are privacy, breathtaking views and garage space. Location is top of mind for luxury consumers when choosing a home (45%), followed by price (39%). Wealthy Americans prefer mid-sized to large modern contemporary styled homes, ideally located on the West Coast.
- High-tech security systems, smart lighting and energy-saving solutions stand out as the top three preferred technologies among luxury consumers. Notably, the preferences in smart home technologies vary across age groups.
- Older generations (45+) lean toward prioritizing convenience, while the younger demographics (18 – 34) express a preference for privacy and security. Individuals aged 35 – 44 prioritize health tech systems, such as air quality control and water analysis sensors.
Major takeaway:
“After a year of high interest rates, housing shortages and conflicted consumer sentiment, it’s encouraging to see such a positive outlook on the luxury real estate market for 2024,” said Michael Altneu, vice president of Coldwell Banker Global Luxury. “If lower mortgage rate trends combined with the new inventory momentum continues, luxury homebuyers could be inspired to move forward with their next home purchase. As they prioritize new amenities, features and even explore overseas options for their next property, I’m excited to see our Coldwell Banker Global Luxury Property Specialists guide both buyers and sellers to achieve their dream homes.”
Jade Mills, president of Jade Mills Estates and international ambassador of the Coldwell Banker Global Luxury program, added: “In contrast to the pandemic home-buying boom, we’re seeing luxury homebuyers more than willing to wait to find the perfect house in 2024 that meets every single one of their needs whether it’s privacy, wellness amenities, lifestyle experiences, latest technology or a combination of all those factors. Specifically, turn-key, move-in ready homes with easy access to the best luxury amenities provide buyers with instant gratification in attaining their desired lifestyle. Whether it’s purchasing the home that has it all or upgrading their current home with trending features, I’m looking forward to seeing both buyers and sellers enjoying the decisions they make for their home this year.”
For the full report, click here.
