Christie’s International Real Estate just came out with their report on the state of luxury real estate in three world class cities, Miami, New York and London, all of which are experiencing significant growth.
Buyers with high net worth, wishing to spend $1 million or more on residential property, can afford to acquire homes anywhere in the world, and often do so in multiple locations. They view real estate as a safe investment.
While 2012 was a rebound year for increasing home prices in luxury destinations, 2013 experienced a different surge. Prices remained relatively constant while the number of units sold was exceptionally strong, exceeding 2012 levels. Thus, sales volume and not price drove the velocity of the 2013 markets in these cities. In the exhibit to the right, units sold represent sales through the third quarter of 2013.
Miami, New York and London are experiencing a renewed housing boom fueled by local residents, foreign buyers and, in part, young millionaires jumping into home ownership. Luxury homes are selling more quickly as inventory levels remain low.
A good barometer for declining inventory and expected price increase is the number of days a home is on the market. Low inventory levels combined with more buyers reduced the number of days the average luxury home was on the market in 2013.
Since 2011, Miami luxury homes have been on the market an average of 35 days less, New York an average of 41 days less and London an average of 16 days less. The pie chart reflects sales through the third quarter of 2013.
The luxury buyer seeks cities that offer economic stability, ease of doing business, transportation options, cultural and lifestyle services, and attractions. Miami, New York and London have it all.
Click this link to see my blog on Luxury Home Trends for 2014.
I am a luxury residential specialist in Coral Gables, Coconut Grove and Pinecrest. If you would like to schedule a buyer, seller or investor meeting, kindly give me a call at 305.898.1852 or send me a note at Wellins.D@ewm.com.