As we step into 2024, the luxury real estate market presents a vibrant picture of renewed hope and enthusiasm among high-net-worth consumers, setting the stage for a renaissance in the world of luxury living. This year, Coldwell Banker Global Luxury’s “The Trend Report,” accompanied by a luxury consumer survey, showcased increased consumer optimism in luxury real estate as the fourth quarter of 2023 welcomed fresh energy from luxury homebuyers.
The resounding optimism is more than just a number; it’s a pulse felt and embraced by over one-third of surveyed luxury consumers who feel that 2024 will be a better time to buy or sell a home compared to last year. Moreover, a robust 68 percent agree that real estate is a safe investment.
Let’s dive into the dynamic trends and survey insights around the themes that are shaping the luxury real estate landscape for 2024.
Wrapping up 2023 strong
Luxury real estate witnessed quite the finale to 2023: in Q4, the luxury housing market saw a notable surge in sales, with single-family homes experiencing a 4.2 percent increase and attached properties soaring by an impressive 14.2 percent compared to the previous year.
New listings also experienced a boost, rising by 14.2 percent for single-family homes and 7.2 percent for attached properties during the same period. These figures signify a rejuvenated interest in luxury real estate, setting a positive tone for the industry.
America, a real estate investment haven
For the global elite, U.S. luxury property continues to be a means of asset diversification and investment. International buyers in the top 5 percent of the market witnessed a substantial 25 percent growth in 2023, emphasizing the enduring appeal of luxury real estate in the United States. The top international buyers came from China, Canada, and the United Kingdom, and the most desired U.S. cities to purchase in are New York, Los Angeles, Miami, San Francisco, and Washington, D.C.
Simultaneously, wealthy Americans are exploring opportunities abroad, with nearly 40 percent 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 takes the lead as the top destination (29 percent), followed by North America outside the U.S. (28 percent) and the Caribbean (23 percent).
Social media’s impact on luxury buyers
In the modern age of pixels and hashtags, social media plays a pivotal role in shaping the preferences of luxury homebuyers. We found a staggering 73 percent of affluent consumers admit to being influenced by social media in their decision to purchase a particular home. Instagram, YouTube and TikTok have emerged as the top social media platforms luxury consumers are scrolling through for dream home inspiration.
Specifically, TikTok has become a powerhouse for younger generations aged 18-24, with 64 percent acknowledging its influence in their desire to purchase a specific type of home. The platform’s bite-sized videos and virtual walkthroughs have proven to be effective tools for millennials and Generation Z to connect with real estate agents and gain insights into the housing market.
Have-it-all properties for selective buyers
In a world where compromise whispers in the ears of uncertainty, luxury consumers stand tall, unwavering in their pursuit of perfection. Privacy, breathtaking views and garage space top the list of desired amenities for affluent consumers. Location is top-of-mind for 45 percent of luxury respondents when choosing a home, followed closely by price at 39 percent.
Today’s affluent buyers are more discerning than ever, prioritizing location, privacy, wellness amenities, lifestyle experiences and the latest technology. In other words, they want it all. Four specific property types will likely check all boxes for selective buyers this year: “Of the moment” luxury homes, vertical country clubs, branded residences and golf-lifestyle hybrid communities.
A year of optimism
After a year of high interest rates, housing shortages and conflicted consumer sentiment, we’re now in a pivotal moment for the luxury real estate market.
As we begin embracing 2024 as the year of optimism, the market stands poised for a transformative journey guided by the threads of consumer confidence, dynamic trends and evolving preferences that weave together to define the narrative of luxury living moving forward.
For a detailed exploration of “The Trend Report” and survey results, visit Coldwell Banker Global Luxury.