Luxury Real Estate Agents are Confident, Optimistic Heading into 2023, According to Global Study by Luxury Portfolio International®

 Research of 200+ member brokers of Luxury Portfolio International® (LPI), the world’s leading luxury residential real estate network, is providing important global insight into what’s most heavily impacting the rapidly-evolving, ultra-luxury residential real estate market — and what’s on the horizon for 2023. 

Titled The Business of Luxury Real Estate, the study polled a cross-section of top residential real estate brokerages, their principals, and top-producing agents.

Across all markets, real estate professionals recognize that COVID drove an unprecedented but unsustainable market, with many major municipalities experiencing generally low levels of available inventory — in some cases, as low as barely one month of available inventory. A ‘stable’ luxury market will have 12-18 months of available inventory.

On the basis that 2020, 2021, and the first part of 2022 have represented an industry anomaly, a majority of survey participants remain optimistic as markets stabilize, noting that, for the most part, there is no ‘glut’ of inventory. Rather, the market is simply correcting itself from the historically low levels of available inventory.

Key findings from the study include:

• 63% of member brokerages expect stable or growing sales throughout the remainder of 2022
• 79% expect stable or rising home values in their respective markets during the remainder of 2022
• 95% reported moderate to high optimism about their overall market in the next 12 months
• Rising inventories have equated to an increase in days-on-market, which has led to price reductions in select markets, and, for the first time since the pandemic, a slight shift towards a buyers’ market
• Prime location, size and updated amenities are the most common factors in luxury homes selling right now; new construction and move-in-ready remain highly attractive features to luxury buyers
• Also, demand continues for outside space, trophy views and locations, and in some markets, the highest demand for luxury condominiums since the pandemic slowed those markets
• While the study conveyed that the recent decrease in sales and increase in inventory were necessary to achieve market stabilization, the study also noted that external, geo-political matters — such as the war in Ukraine — are causing high-end consumers to evaluate when and where they realize their purchases
• While 45% of LPI members conveyed concern about the impact that rising interest rates will continue to have on the luxury residential real estate market in the remainder of 2022, a companion survey by Affluent Consumer Research Company of U.S. revealed a growing desire among affluent consumers to purchase luxury homes
• It is important to note that the exponential growth of the luxury residential real estate market was realized without much (if any) impact from international buyers due to the shutdown in travel from COVID; members surveyed, particularly in cities where the international buyer is a key factor, noted that they have begun to see the return of that consumer
• International buyers account for 18% of the total luxury business for 79% of member firms, so the fact that the sales continued to be so robust with this important sector mainly absent since the pandemic communicates the viability of the luxury sector of the market
• As travel restrictions relax, the study reveals that these international buyers are looking for privacy, safety, high-quality private schools, better infrastructure (e.g., medical facilities), safer investments and cultural enhancements
• A strong business community and a reputable government that invests in its infrastructure were noted by member firms as another key factor in the luxury residential arena

According to the study, members also believe that rising interest rates will likely have a negative impact on luxury real estate sales throughout the remainder of 2022; however, a companion consumer study by LPI showed a 55% increase, year-over-year, in the likelihood of purchasing luxury real estate over the 90 days from July to August (14.7% vs 18.2%).   

So, the luxury real estate buyer remains in the market despite rising interest rate issues. That said, they also acknowledge that prices are “high right now,” with 56% describing them as “more expensive than they should be.” Also showcasing their mindset: 76% of likely homebuyers admit that “even in times of personal financial uncertainly, I buy high-quality products.”

Another unique takeaway is that tourism boards and similar organizations are playing an increasingly critical role in the development and marketing of luxury real estate. Drawing this type of market sector is a win-win for most communities, and efforts of these organizations and cooperation with luxury brokers is on the rise.

“This on-the-ground, in-the-trenches research gives unparalleled access into what many of the industry’s most successful luxury real estate agents are currently seeing – and all during one of the most extraordinary times the industry has ever experienced,” said Mickey Alam Khan, President of Luxury Portfolio International®. “We are fortunate to be gleaning crucial feedback from agents in far-reaching markets, offering a fresh, first-hand insiders’ perspective on how key trends are shaping the habits of high-net-worth buyers and sellers. This exceptional content tells us about the implications these gyrations are expected to have in the year ahead.”

To access the complete report, please visit the following link: https://www.luxuryportfolio.com/reports

Luxury Portfolio International (luxuryportfolio.com) is the leading network of the world’s premier luxury real estate brokerages and their top agents, offering unparalleled marketing and intelligence services across the globe. The network currently comprises 245-plus members in more than 45 countries. It is the luxury arm of Leading Real Estate Companies of the World® the global network of top independent real estate firms, with 550 companies and 136,000 sales associates in over 70 countries. Last year, network members participated in over 1.2 million global transactions. LPI attracts a global audience of visitors from more than 200 countries/territories every month and markets more than 50,000 luxury homes annually. Well Connected.™ 

Contact: pr@luxuryportfolio.com

CONTACT:
Israel Kreps
Caroline Underwood
ikreps@krepspr.com
cunderwood@krepspr.com

Related Post
Yili Group Presents Its Biodiversity Conservation Efforts at the UN Biodiversity Conference
LiqTech Receives Wastewater Treatment System Order for Metal Processing Industry
EIGER BIOPHARMACEUTICALS CLASS ACTION ALERT: Wolf Haldenstein Adler Freeman & Herz LLP announces that a securities class action lawsuit has been filed in the United States District Court for the Northern District of California against Eiger BioPharmaceuticals
Chinese NMPA Approves Study of Telix Kidney Cancer Imaging Candidate
Levi & Korsinsky Notifies Yatsen Holding Limited Investors of a Class Action Lawsuit and Upcoming Deadline