Posts Tagged as Luxury Homes

What to Know About the Luxury Real Estate Market in These Uncertain Times

What to Know About the Luxury Real Estate Market in These Uncertain Times

At the beginning of the year, all eyes were on the housing market as it began to show signs of slowing. With a sharp rise in inventory and multiple interest rate hikes on the horizon, the future of real estate sales was uncertain. Instead, interest rates have lowered and the market appears to have entered a transitional period, where affordability challenges have pulled back price growth, particularly in the luxury real estate market.

What’s Driving Changes in the Luxury Real Estate Selling Market?

1. Market Correction
Nationally, the market is shifting in favor of buyers. Transactions over $10-million are finally on the rise. Homes unrealistically overpriced over the past 2-years have come down, particularly in regions that experienced double-digit price growth. This has created an intersection where the seller and buyer can compromise on price, boosting the buyer’s market morale.

2. Tax Law Changes

Tax law changes are hurting luxury homes at the top-end of the market. Mortgage interest and property taxes are no longer fully deductible, increasing the burden on homeowners. The luxury market has understandably taken the biggest hit, with homes priced at $2-million or more witnessing a sales slump for the first time in nearly 3 years, falling 1.6%. 

3. Disappearing Foreign Funds

Markets such as NYC, once dominated by foreign money, are no longer seeing the competition of international buyers. As politics and the trade war have intensified, buyers are now more typically American. Russian buyers have disappeared, and the days of predominantly Chinese buyers are over.

4. Higher Construction Costs

The inflated prices of land, building materials, labor, and burdensome permitting regulations are pushing builders to the luxury end, softening the market.

Weather these changes with flair. Stay on top of the latest market trends with the help of these and other real estate selling tips from Properties Online today.

Green and Smart Homes Top the Want List for Luxury Home Buyers

The Future of Luxury Homes
The Future of Luxury Homes

Ultra-high net worth (UHNW) individuals, those with a net worth of at least $30 million, are changing real estate trends – and not just for the ultra-rich. According to Wealth-X and Sotheby’s International Realty UHNW Luxury Real Estate: Multi-Use Homers Report, topping the want list of the world’s wealthiest individuals: Homes that are both smart and green.

A Smart investment
Smart homes, offer amenities those with UHNW long for, including top-of-the-line security, energy management systems, HVAC control, health monitoring, media, music, and more. Further driving the trend: Almost 10% of Americans with UHNW made their moolah in the tech industry.

Putting the green in greenbacks
UHNW real estate investors also want green homes. Home that are not only sustainably sourced and constructed, but environmentally friendly and sustainable with features like solar power, geo-thermal heating and cooling, rainwater collection, and efficient appliances.

Sphere of influence
UHNW buyers are fueling real estate trends, shifting consumer perception with the help of other knowledgeable homebuyers to invoke a 10% rise in LEED-certified homes in the U.S. – double in Canada. The market has been quick to respond.

The (rich) girl next door
UHNW buyers are branching out beyond modern urban hubs to markets such as Miami, Long Island, Caribbean areas, private islands, and Europe. The U.S. is the most popular location for second homes among the ultra-wealthy. And with 79% of UHNW’s owning two or more (50% with three or more), there’s more opportunity in this niche market than ever.

UHNWI need real estate agents too
Do you know how to cater to UHNWI? Intelligence and prospecting firms like Wealth-X can help you determine if growing a business relationship with these individuals may be in your real estate future.

Are you up on these real estate trends, sure to be on the horizon for many future buyers? Stay in-the-know with Properties Online today.