{"id":5267,"date":"2026-03-25T08:00:34","date_gmt":"2026-03-25T15:00:34","guid":{"rendered":"https:\/\/livsothebysrealtyca.blog\/?p=5267"},"modified":"2026-03-03T12:02:42","modified_gmt":"2026-03-03T20:02:42","slug":"endurance-test","status":"publish","type":"post","link":"https:\/\/livsothebysrealtyca.blog\/spu\/endurance-test\/","title":{"rendered":"Endurance Test"},"content":{"rendered":"\r\n\t\t
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Luxury real estate holds its appeal as an investment\u2014and a lifestyle.<\/h2>\r\n
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Whether driven by economic opportunities or the desire for a lifestyle to share with friends and family, property purchases by high-net-worth individuals (HNWIs) in \u20282025, when the luxury real estate market outperformed the overall housing market, position the sector for continued strength, says Philip A. White Jr., president \u2028and CEO, Sotheby\u2019s International Realty.<\/span><\/p>\n

\u201cThe general real estate market was more impacted by elevated interest rates and affordability issues such \u2028as higher prices,\u201d White says, \u201cbut the luxury real estate market is positioned for continued outperformance, building on 2025\u2019s robust foundation, which included areas seeing increased inventory, growing international homebuyer activity and a larger percentage of all-cash sales, particularly at the higher end.\u201d<\/span><\/p>\n

While market performance depends on a variety of factors, the Sotheby\u2019s International Realty affiliated agents who primarily sell homes in the US$10 million and above range were the most optimistic about their global markets for 2026, according to the 2026 Sotheby\u2019s International Realty agent survey (see report starting on page 22).<\/span><\/p>\n

\u201cWe expect global sales to further strengthen, as luxury property buyers are less constrained by\u2028<\/span>geography,\u201d White says. \u201cThe fundamentals supporting luxury real estate remain strong. We are seeing sustained wealth creation at the high end, inventory remains constrained in premier markets with some growth, \u2028and lifestyle-driven demand shows no signs of stopping.\u201d<\/span><\/p>\n

In the U.S., the contrast between the luxury and general housing markets is significant, according to Lawrence Yun, chief economist and senior vice president of research at the National Association of REALTORS\u00ae (NAR). \u201cThe upper end has seen huge home equity gains, so if homeowners in that price range decide to sell, they have additional buying power,\u201d he says. \u201cWe\u2019ve also seen the stock market reach an all-time high [in October 2025], which can loosen up the purse strings.\u201d<\/span><\/p>\n

Homebuyers at the very high end of housing markets tend to be impervious to macroeconomic factors, says Mark Zandi, chief economist at Moody\u2019s Analytics. \u201cThey\u2019re in great financial shape,\u201d he says. \u201cAt the lower end of the luxury market spectrum, homebuyers are a little more sensitive to their overall net worth and the stock market.\u201d The threshold for a luxury home in the U.S. now starts at US$1.3 million nationally and is much higher in some markets, according to research released in September 2025 by Realtor.com\u00ae, which defines \u201centry-level\u201d as within the top 10% most expensive homes. \u201cHigh-end\u201d luxury, within the top 5% of the market, starts at \u2028US$2 million nationally and \u201cultra-luxury,\u201d the top 1%, starts at US$5.4 million. In 2016, the entry point for \u2028a luxury home nationally was just US$796,922, according to Realtor.com\u00ae, while today in Los Angeles, California, entry-level luxury starts at US$3.9 million, and in New York City at US$2.8 million. <\/span><\/p>\n

Despite the potential headwinds of slower job growth and inflation, Yun is optimistic about the prospects for the upper end of the housing market in 2026. If mortgage rates continue to decline, as they have according to \u2028a November 2025 report by mortgage company Freddie Mac, he anticipates a surge of demand.<\/span><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n

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A luxury penthouse at \u2028the Four Seasons Private Residences in Abu Dhabi, United Arab Emirates, broke records when it sold for US$54.5 million in 2025.<\/em><\/p>\n

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“Recent record- breaking sales demonstrate the property market\u2019s strength and appetite for premium properties.”<\/span><\/h4>\n

-Philip A. White Jr. President and CEO, Sotheby\u2019s\u2028International Realty<\/span>\n<\/p><\/blockquote>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n\n\t

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\u201cInterest rate stability, if achieved, could unlock significant additional homebuyer activity,\u201d White says. \u201cUltra-high-net-worth individuals [UHNWIs] are less rate- sensitive, but we know they are inclined to be more active when financial markets demonstrate stability.\u201d<\/span><\/p>\n

Yun anticipates that, following the rate cuts in September, October and December 2025, the Federal Reserve will continue to lower interest rates incrementally, which could in turn help lower mortgage rates. \u201cI expect the economy to continue to hum along nicely, with stable unemployment rates and respectable 2% GDP growth \u2028into at least the middle of 2026,\u201d he says.<\/span><\/p>\n

Stock market performance also had an impact on luxury homebuying. \u201cThe luxury housing market stalled for a short time in March 2025, when the stock market corrected, but since then it has been outperforming the lower end,\u201d Yun says. \u201cI can\u2019t predict exactly what will happen with the stock market, but based on its current performance, the outlook for luxury real estate in 2026 \u2028is bright.\u201d<\/span><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n<\/div><\/div>\r\n\t\t

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Despite some volatility, the overall strong stock market performance of the last two years has increased the net worth of households, which in turn benefits the luxury real estate market, agrees White. \u201cWe\u2019re also \u2028seeing that luxury homebuyers are younger, which is \u2028a function of wealth creation and the transfer of wealth \u2028to a new generation. This is in contrast to the overall housing market, where homebuyers are older.\u201d<\/span><\/p>\n

Another trend is that periods of high inflation can spur the sales of luxury properties as a hedge. Values typically rise along with inflation, adding to profitability for home sellers, and inflation levels have hovered around 3%, according to data released by the U.S. Department of Labor in October 2025.<\/span><\/p>\n

\u201cRecent record-breaking sales demonstrate the property market\u2019s strength and appetite for premium properties,\u201d White says. \u201cIn downtown Manhattan, New York, a penthouse is under contract for US$87.5 million, and a co-op in San Francisco, California, sold for \u2028US$24 million. In Abu Dhabi, a penthouse in the Four Seasons Private Residences at Saadiyat Beach\u2014which \u2028is still under construction\u2014sold for US$54.5 million, \u2028well above the previous record price of US$37.3 million set in 2024, according to Abu Dhabi Sotheby\u2019s International Realty. These transactions, as well as a record sale in Old Greenwich, Connecticut, for US$21 million and a record sale for US$50 million in San Diego, California, signal sustained demand at the highest levels.\u201d<\/span><\/p>\n

In the general housing market, the government- backed mortgage provider Fannie Mae predicts that \u2028home sales\u2014including existing homes and new-builds\u2014 will rebound in 2026, rising an estimated 9.2% over \u2028the previous year, according to a September 2025 \u2028report by Real Estate News.<\/span><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n<\/div><\/div>\r\n\t\t

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The impact of inherited wealth<\/h2>\r\n
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Wealth creation comes from a variety of sources, including business success, investment gains and, increasingly, inheritance. Generational wealth transfers should \u2028continue to drive luxury real estate demand, building on 2025 flows that reached an estimated US$6 trillion across wealthy nations, the equivalent of 10% of global GDP, according to research published in June 2025 by The Economist. In Italy, for example, inheritances represent 20% of the country\u2019s GDP.<\/span><\/p>\n

An estimated US$124 trillion will now transfer intergenerationally through 2048, mainly between the Silent Generation (born 1928-45) and Baby Boomers (born 1946-64) to younger generations, according \u2028to a Q1 2025 report by Cerulli Associates, a research \u2028and consulting firm. Included in the total figure is an estimated US$25 trillion in real estate, according to Federal Reserve data reported by CNBC in August 2025.<\/span><\/p>\n

This generational wealth transfer, which a February 2025 report in The Economist terms \u201cinheritocracy,\u201d is creating an emerging class of HNWIs who are influencing global real estate markets. In the U.S., where asset values\u2014including real estate and the stock market\u2014have risen in recent years while inheritance taxes have fallen, the number of wealthy individuals continues to grow, according to the report.<\/span><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n<\/div><\/div>\r\n\t\t

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Cryptocurrency and luxury \u2028real estate<\/h2>\r\n
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Another source of wealth that is beginning to impact \u2028the luxury property market is cryptocurrency. In 2021, \u2028a US$22.5 million penthouse sale at Arte Surfside in Miami, Florida, made headlines as the first publicly known example of a crypto purchase, as reported by Forbes in June 2021. In 2024, Neyshia Go, global real estate advisor, Sotheby\u2019s International Realty – Beverly Hills Brokerage, sold a newly built house in Beverly Grove for US$4.925 million, with the buyers cashing in their crypto investment for the purchase. Since then, some sellers of luxury properties in Dubai, California and New York have expressed a willingness to accept cryptocurrency.<\/span><\/p>\n

In Dubai, 30% of UHNWIs hold crypto assets, which \u2028is having an impact on the real estate market there, according to a February 2025 report by Forbes, citing research by the residence and citizenship consultancy Henley & Partners. Loans made with Bitcoin as collateral, estimated at US$8.58 billion today, are expected to reach <\/span><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n\n\t

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Inherited wealth in 2025 US$6 trillion to be inherited worldwide = 10% of global GDP Source: \u201cHow to Invest Your Enormous Inheritance,\u201d The Economist, June 2025<\/em><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n<\/div><\/div>\r\n\t\t

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US$45.27 billion by 2030, according to a June 2025 report by Realtor.com\u00ae, and crypto loans are particularly popular for second homes.<\/span><\/p>\n

However, Zandi warns that the increased use of cryptocurrency for home purchases could generate volatility in the luxury housing market. \u201cCrypto prices \u2028are subject to wild swings, which could result in similar variations in luxury home demand,\u201d he says.<\/span><\/p>\n

Conversely, Yun argues that this volatility might be offset by the expanding homebuyer pool. \u201cMajor financial institutions are investing in cryptocurrencies, as are younger people,\u201d he says. \u201cFinding a way to include those assets in underwriting widens the pool of homebuyers, which could be beneficial to the luxury housing market.\u201d <\/span><\/p>\n

The regulatory landscape around cryptocurrencies \u2028is evolving rapidly. Since the current administration \u2028took office in January 2025, there have been moves to encourage the use of digital assets in a variety of ways, such as the U.S. Securities and Exchange Commission (SEC) and the U.S. Commodity Futures Trading Commission coordinating efforts to facilitate crypto trading, according to a joint statement issued in September 2025.<\/span><\/p>\n

In June 2025, the Federal Housing Finance Agency, which oversees the mortgage providers Fannie Mae and Freddie Mac, ordered the agencies to prepare a proposal that would allow cryptocurrency holdings to count as an asset for mortgage applicants, according to a report by \u2028AP News. And while that policy has yet to be enacted, \u2028a handful of private lenders already allow it, as reported in August 2025 by Yahoo Finance.14 Otherwise, borrowers are typically required to convert their cryptocurrency holdings into dollars if they are to be included among \u2028their assets.<\/span><\/p>\n

In the years ahead, cryptocurrency may play a larger role in the economy and real estate, since globally just over half (51%) of Gen Z own crypto assets, according to research released in January 2025 by Gemini, a finance platform. This compares to 35% of people of all ages globally. The research also found that nearly half (48%) \u2028of Gen Z use crypto to generate investment income, compared with 41% of all crypto owners.<\/span><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n<\/div><\/div>\r\n\t\t

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This estate in Montecito, California, evokes quiet sophistication.<\/p><\/div>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n<\/div><\/div>\r\n\t\t

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Taxes, tariffs, exchange rates \u2028and geopolitics<\/h2>\r\n
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Tax policy changes also bode well for luxury real estate, particularly the raising of caps on state and local tax deductions, from US$10,000 to US$40,000, on U.S. federal income tax returns for 2025.<\/span><\/p>\n

\u201cThis will be a game changer in states with higher taxes\u2014it\u2019s a clear additional benefit to buying a more costly home if you can deduct more,\u201d Yun says. \u201cReal estate agents should relay this message to their customers, especially in states with higher taxes such \u2028as New Jersey, New York, Massachusetts, Maryland, California and Washington.\u201d<\/span><\/p>\n

A potential wild card for the luxury housing market in the U.S. is the discussion about raising the limits on capital gains tax exclusions, Zandi says. Currently, home sellers can exclude up to US$250,000 (or US$500,000 for married couples) in capital gains on their home from their tax calculation. If the rules on capital gains exclusion change, Zandi believes it could generate more luxury property inventory.<\/span><\/p>\n

Tariffs, a less positive policy change, typically raise inflation and lower economic growth, Zandi says. \u201cOverall, the effective rate of tariffs in late summer 2025 was about 10%, compared to typically 2% in the past. I expect tariffs to gradually settle into an overall effective rate of 15%, which may have a negative effect on the U.S. economy into 2026 or longer.\u201d<\/span><\/p>\n

However, factors such as tariffs, shifting exchange rates and geopolitical dynamics have been less disruptive to luxury real estate than initially expected, White \u2028says. \u201cThe big story is really about selectivity. We\u2019re seeing wealthy homebuyers become much more particular \u2028about where they invest. Compared to during the pandemic, we\u2019re seeing that homebuyers are gravitating toward established luxury property markets with \u2028more solid fundamentals, rather than trying to chase speculative opportunities.\u201d <\/span><\/p>\n

Currency fluctuations are also creating interesting dynamics, he says. \u201cReal estate markets in foreign countries that seemed expensive six months ago might look attractive now, depending on exchange rates. Additionally, ongoing geopolitical tensions have driven homebuyers toward regions they view as more secure \u2028and stable, while tariff uncertainty is making some international homebuyers more cautious about timing their purchases.\u201d<\/span><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n<\/div><\/div>\r\n\t\t

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International viewpoints \u2028and local trends<\/h2>\r\n
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Agents within the Sotheby\u2019s International Realty network say that political and economic stability are extremely important factors, along with security and privacy, in \u2028a homebuyer\u2019s choice of where in the world to buy their residence, according to the 2026 Sotheby\u2019s International Realty agent survey.<\/span><\/p>\n

\u201cWe continue to see luxury real estate buyers increase their portfolio of homes in different areas, both in the U.S. and internationally,\u201d White says. \u201cOur collaboration with Concierge Auctions has shown us that luxury homebuyers often bid on multiple properties across various locations. This global perspective reinforces our view of the real estate market as a unified landscape, where buyers consider investments not just locally but internationally.\u201d<\/span><\/p>\n

However, he believes that not all high-end real estate markets will perform equally. \u201cWe expect continued geographic selectivity. Prime urban property markets \u2028with strong economic drivers, world-class amenities and limited supply will continue to outperform.\u201d<\/span><\/p>\n

As always, real estate trends are highly localized. \u2028\u201cThe inventory story varies dramatically by price point and location,\u201d White says. \u201cWe\u2019re seeing opportunities emerge in certain segments and markets\u2014in Washington, D.C., and Houston, Texas, in the U.S., and abroad in Portugal, Spain and Thailand\u2014which are showing improved inventory levels compared to recent years, particularly in the luxury range. The key for homebuyers is to understand these dynamics\u2014what appears to be a homebuyer\u2019s market in one segment may still be highly competitive \u2028in another, even within the same geographic area.\u201d<\/span><\/p>\n

While there are luxury properties in numerous areas within the U.S., there are some locations with a particularly high concentration. Seven of the top 10 most-expensive \u2028zip codes in the U.S. are in Southern California, but Fisher Island in Miami Beach is the most expensive, according \u2028to an August 2025 report by Realtor.com\u00ae. The other \u2028two East Coast zip codes on the list, Bridgehampton and Water Mill, New York, are both in the Hamptons on Long Island. These locations represent \u201cultra-luxury territory, where virtually every home on the market is a multi- million-dollar listing and the majority are among the \u2028top 1% most expensive listings within the U.S.\u2014a tier \u2028for those priced at US$5.7 million and up,\u201d White says. <\/span><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n\n\t

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The striking modern interior of \u2028a luxury home in Tucson, Arizona.<\/em><\/p>\n

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“We\u2019re seeing wealthy homebuyers become much more particular about where they invest.”<\/span><\/h4>\n

-Mark Zandi, chief economist, Moody\u2019s Analytics<\/p>\n<\/blockquote>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n<\/div><\/div>\r\n\t\t

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This newly built sculptural residence commands an elevated view across 120 acres near Australia\u2019s Byron Bay.<\/em><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n<\/div><\/div>\r\n\t\t

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Lifestyle is driving choice<\/h2>\r\n
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In the 2026 Sotheby\u2019s International Realty agent survey, more than half (60%) of affiliated agents said that lifestyle had been a more important factor to luxury homebuyers than in previous years (see report on page 22). The emphasis on lifestyle was particularly important to homebuyers in Oceania, the Caribbean, South and Latin America, and Africa and the Middle East.<\/span><\/p>\n

\u201cLifestyle-driven property markets are certainly thriving,\u201d White says. \u201cSki destinations continue to show exceptional strength. In fact, Aspen Snowmass Sotheby\u2019s International Realty listed a US$300 million estate in August 2025\u2014with 74 acres and just a mile from town\u2014 which is the most expensive home ever listed in the U.S., according to an August 2025 report by Forbes. And in October 2025, Puerto Rico Sotheby\u2019s International Realty listed a multigenerational estate for US$65 million in Puerto Rico, which will be the highest-priced property there if it sells near the asking price, according to an October 2025 report by The Wall Street Journal.\u201d<\/span><\/p>\n

\u201cLegacy Properties Sotheby\u2019s International Realty in Maine achieved the sale of a home near the Bush family compound in Kennebunkport for US$12 million in July 2025\u2014after just 90 minutes on the market. This was followed by the September 2025 sale of Bette Davis\u2019s former estate in Cape Elizabeth, Maine, for US$13.4 million, marking the state\u2019s priciest deal in a decade.\u201d<\/span><\/p>\n

\u201cWe\u2019re also seeing strong performance in property markets that combine multiple lifestyle elements, such as ski-to-golf communities or wine country properties,\u201d White says. \u201cAdditionally, the wellness trend has evolved since the pandemic, with homebuyers prioritizing in-home spas and hotel-style amenities, particularly in branded residences.\u201d\u2006<\/span><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n<\/div><\/div>\r\n\t\t

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Is lifestyle a growing decision-making factor\u2028for today\u2019s homebuyers?<\/strong><\/p>\n

Most Sotheby\u2019s International Realty affiliated\u2028agents say it is, but it varies across regions<\/span><\/p>\n

Source: 2026 Sotheby\u2019s International Realty agent survey<\/span><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n<\/div><\/div>\r\n\t\t

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Foreign homebuying activity in the U.S.<\/strong><\/p>\n

Source: National Association of REALTORS\u00ae,<\/span><\/p>\n

\u201cInternational Transactions in U.S. Residential Real Estate,\u201d July 14, 2025<\/span><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n\n\t

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Cross-border transactions<\/h2>\r\n
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The U.S. remains a popular location for UHNWIs looking \u2028to buy a home. According to a July 2025 report by NAR \u2028on international residential transactions in the U.S., foreign homebuyer activity for existing homes increased by 44% from April 2024 through March 2025, the first year-over-year growth since 2017.<\/span><\/p>\n

\u201cFrom our perspective, the primary factor in its continued appeal is the relative stability of U.S. real \u2028estate, which is especially compelling amid ongoing geopolitical uncertainties,\u201d White says. \u201cWe anticipate \u2028this continuing throughout 2026.\u201d<\/span><\/p>\n

Yun also believes that the current U.S. administration\u2019s push to introduce a \u201cgolden visa\u201d \u2028for foreigners willing to pay US$1 million for a path \u2028to citizenship will open more opportunities. \u201cI expect \u2028to see more Chinese homebuyers in the U.S. because their economy is expanding, and there are more millionaires and billionaires there who want to invest \u2028their money in the U.S.,\u201d he says. \u201cThe economy in \u2028India is also growing, so we\u2019re likely to see more \u2028investors from there.\u201d<\/span><\/p>\n

According to NAR\u2019s research, China remains the \u2028top country of origin among foreign real estate buyers, with Canada, Mexico, India and the U.K. rounding out \u2028the top five.<\/span><\/p>\n

When it comes to the location of U.S. real estate investments, traditional patterns continue to hold, \u2028White says. Florida leads, accounting for 21% of \u2028purchases by foreign homebuyers, followed by \u2028California, Texas and New York, according to NAR. <\/span><\/p>\n

\u201cWhat\u2019s particularly interesting is the growing interest in lifestyle destinations beyond the traditional gateway cities\u2014places like Charleston, South Carolina; Nashville, Tennessee; and ski markets in Colorado and Utah,\u201d White says. \u201cThese offer compelling value propositions for international homebuyers seeking lifestyle experiences.\u201d <\/span><\/p>\n

Travel patterns also reflect where people buy property, particularly second homes. \u201cRather than collecting properties in numerous destinations, homebuyers are focusing on places where they plan to spend extended periods,\u201d White says. \u201cAmerican Express Travel\u2019s March 2025 Global Travel Trends Report highlighted that travelers were prioritizing experiences that blend luxury, cultural immersion and personal connection\u2014and that\u2019s what is driving decisions.\u201d<\/span><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n<\/div><\/div>\r\n\t\t

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The luxury housing market in central London\u2014where this three-bedroom apartment is located, in the OWO Residences by Raffles\u2014is bucking the trend of volatility seen in other locations.<\/p><\/div>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n<\/div><\/div>\r\n\t\t

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SPOTLIGHT ON GLOBAL MARKET<\/h4><\/span><\/span>\n<\/div>\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n<\/div><\/div>\r\n\t\t
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While global politics and economics play a role in high-end property purchases, national and regional factors<\/a> are also influential, as evidenced in trends across key markets within the Sotheby\u2019s International Realty network.<\/span><\/p>\n

\"Property

Property in Manhattan, such as this US$10.25 million apartment in Chelsea, is particularly appealing to buyers \u2028from overseas.<\/p><\/div>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n<\/div><\/div>\r\n\t\t

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New York, New York<\/strong><\/p>\n

The dearth of inventory at the upper end of the market\u2014above US$20 million\u2014in New York City has kept prices high even if there are fewer sales, says Daniela Sassoun, global real estate advisor, Sotheby\u2019s International Realty – East Side Manhattan Brokerage. \u201cWe\u2019re seeing lots of foreign homebuyers, especially from Brazil, Argentina, the Middle East and London, \u2028in part because the U.S. dollar is cheaper,\u201d she says. \u201cHomebuyers have realized they can get 10% more property value for their pesos or pounds.\u201d<\/span><\/p>\n

Other sources of demand include younger homebuyers who have benefited from the \u201cgreat wealth transfer\u201d between older generations and their children or grandchildren, and people who moved to Florida and want or need to be in New York City more often.<\/span><\/p>\n

\u201cFor many of our clients, a place in Manhattan is a second home where they spend three or four months every year,\u201d Sassoun says. \u201cThese homebuyers \u2028are not bothered by inflation, but they \u2028are sensitive to the mood in general, so \u2028they\u2019re a little more cautious now about the economic climate. They are also more likely to shy away from something that needs work because of the potential \u2028costs of construction.\u201d<\/span><\/p>\n

Local politics has been on the minds of property owners, too. \u201cAfter the New York City mayoral primary [in June 2025], we got 15 to 20 calls a day from our clients wanting to know what the political climate would mean for home values,\u201d Sassoun says. \u201cWe found that prices held steady under every mayor going back 25 years, despite corrections after 9\/11 [in 2001], the start of the Great Recession [2007-08] and the pandemic [from 2020], which reassured them.\u201d\u2006<\/span><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\r\n

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Aspen, Colorado<\/strong><\/p>\n

While there are plenty of ski resorts around the world, few can match the year-round attraction of Aspen, says Mandy Welgos, global real estate advisor, Aspen Snowmass Sotheby\u2019s International Realty.<\/span><\/p>\n

\u201cSome people come here in the summer only or in the winter to ski, while others like the shoulder seasons in spring and fall, when it\u2019s quieter. What\u2019s unusual about Aspen is that while we have all the natural beauty and outdoor mountain activities, we also have downtown, which \u2028is a mecca for art, music, high-end shopping and restaurants, alongside charm and history.\u201d<\/span><\/p>\n

\u201cWe never have much inventory, particularly high-caliber properties, but \u2028we always have demand,\u201d Welgos says. \u201cThere\u2019s a lot of competition for single- family homes and condos within walking \u2028or biking distance of downtown, but some people prefer larger estates for privacy \u2028in the mountains.\u201d<\/span><\/p>\n

To keep Aspen\u2019s charm intact, the surrounding Pitkin County restricts newly built homes to a maximum of 9,250 square feet. Welgos recently listed a property less than a mile from downtown Aspen with two parcels of land, each 36 acres, along with two smaller parcels of an acre each.<\/span><\/p>\n

\u201cOne of the larger parcels has \u2028a beautiful 19,500-square-foot house on \u2028it and a six-acre lake, while the other has an entitlement that allows someone to build another house of that size, until it expires in 2028,\u201d she says. \u201cThe property has\u2028guest and employee housing onsite, \u2028along with space for 45 cars, which is extremely valuable in Aspen, where there\u2019s a shortage of both housing and parking.\u201d <\/span><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\r\n

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London, U.K.<\/strong><\/p>\n

The luxury housing market in central London is bucking the trend of volatility seen in some other markets, says Alex Isidro, managing director of United Kingdom Sotheby\u2019s International Realty. \u201cTransactions increased slightly, although values were down a little during the first half of 2025. Because prices are slightly weaker than normal, averaging about \u2028UK\u00a37 million (US$9.4 million), domestic homebuyers have been our largest group of clients.\u201d<\/span><\/p>\n

Domestic homebuyers looking for residential neighborhoods are buying in Belgravia, Chelsea and Knightsbridge, while international property buyers are drawn to Mayfair. \u201cAmericans are the second-largest pool of homebuyers, although many of them decide to \u2018try before they buy\u2019 and rent for a while \u2028before purchasing property,\u201d Isidro says. \u201cOur other international buyers now are coming from India, Kuwait and Italy.\u201d<\/span><\/p>\n

A proposal to impose an additional \u2028tax on homes in the U.K. valued at more than UK\u00a32 million (US$2.7 million) from 2028, as part of the government budget, could impact luxury market sales, the \u2028BBC reported in November 2025.21 \u2028Despite concern about tax laws driving international homeowners out of London, Isidro says the city is resilient. \u201cWe\u2019ve seen some people leave, but others have seen \u2028it as an opportunity to move in. UHNWIs who own homes valued above UK\u00a35 million (US$6.7 million) are holding onto their property or renting it rather than selling. People see London real estate as \u2028a stable asset that\u2019s much less volatile than some other investments.\u201d<\/span><\/p>\n

The vast majority (92%) of homebuyers Isidro\u2019s office dealt with during the first half of 2025 paid cash, which is a testament to the strength of \u2028the Sotheby\u2019s International Realty brand and its clientele, he says. \u201cOur market should remain as it is for the next few years, until we see another change in \u2028our government. In the meantime, we\u2019ll likely start to see more international activity in London because people like \u2028the safety of investing here.\u201d <\/span><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\r\n

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Dubai, United Arab Emirates<\/strong><\/p>\n

The migration of wealth to the U.A.E. from the U.K. and Europe has led to record sales for both existing homes and yet-to-be-built luxury properties, according to Leigh Williamson, managing director, Dubai Sotheby\u2019s International Realty.<\/span><\/p>\n

\u201cInventory remains about the same \u2028in Dubai, and we still don\u2019t have enough supply for the amount of demand from UHNWIs moving here for their permanent home,\u201d Williamson says. \u201cU.K. homebuyers are still number one for us, and with Europe going through changes, many love what Dubai has to offer. We also see people who live in the U.A.E. trading up, as business continues to grow here.\u201d People from India, Pakistan, Saudi Arabia and Russia are also keen homebuyers, and now Canadians and Americans are showing up as well. While some are purely investing in property for the 5% to 8% return on investment, others are purchasing second homes and primary residences. \u201cWe\u2019re seeing a rise in full- service buildings, like those we\u2019ve seen in Hong Kong, China and New York City for years,\u201d Williamson says. \u201cBranded residences continue to be the driving force for off-plan sales. Waterfront property has always been prime real \u2028estate in the U.A.E., along with golf-course living in a gated community. Some of the world\u2019s top architects are coming up with incredible designs that are truly inspiring.\u201d<\/span><\/p>\n

She anticipates prices for resale assets to level off, especially some that have been overpriced. \u201cHome sellers will have to adjust to the market when they\u2019re looking for a sale, which makes it all the more important to speak with a qualified, experienced real estate agent who is going to be honest and transparent.\u201d<\/span><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\r\n

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“There\u2019s been a modest lift in inventory thanks to the completion and launch of several notable high-end projects over the past year.”<\/span><\/h4>\n

– Woody Mah, Managing Director, List Sotheby\u2019s International Realty, Hong Kong<\/span><\/p>\n<\/blockquote>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\r\n

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Hong Kong, China<\/strong><\/p>\n

The luxury property market in Hong Kong continued its steady recovery in 2025 \u2028after the disruptions of recent years, \u2028says Woody Mah, managing director, List Sotheby\u2019s International Realty, Hong Kong. The number of high-end transactions was up 8% to 10% during the first half of 2025, with prime locations such as The Peak, Mid-Levels and Repulse Bay recording price growth of 2% to 4%, he says.<\/span><\/p>\n

\u201cMuch of this momentum is being driven by sustained low interest rates and the return of international homebuyers, particularly from mainland China and across Asia. There\u2019s been a modest lift in inventory thanks to the completion and launch of several notable high-end projects over the past year. Even so, stock remains tight in top-tier districts such as Central and Tsim Sha Tsui in Kowloon, where demand consistently outpaces availability. This imbalance is keeping sustained upward pressure on values, especially in the ultraluxury bracket above HK$100 million (US$12.8 million), which continues to perform strongly.\u201d<\/span><\/p>\n

Hong Kong\u2019s role as a major financial hub, combined with its enduring appeal to UHNW homebuyers, continues to support confidence in the real estate market, \u2028Mah says. Luxury homebuyers include mainland Chinese investors, local residents, long-term expatriates and UHNWIs from the mainland, many of whom have Hong Kong permanent residency.<\/span><\/p>\n

The biggest change in 2025 was the government easing some of the toughest property-market cooling measures, such \u2028as removing extra stamp duties for non-local and second-home buyers, and relaxing mortgage rules. \u201cFor many homebuyers, that\u2019s taken millions of \u2028dollars off the upfront cost and made financing high-value homes much easier,\u201d Mah says. He sees an opportunity for the Sotheby\u2019s International Realty global network to assist the increasing global mindset of affluent local homebuyers, \u2028as destinations like Japan, Thailand, Australia, New Zealand and the U.K. become especially attractive. <\/span><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\r\n

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Queenstown, New Zealand<\/strong><\/p>\n

In the Southern Lakes region of New Zealand, sales in the NZ$4 million \u2028(US$2.3 million) and higher luxury property market\u2014and total sales volume\u2014 increased in 2025, says Clodagh Hall, \u2028chief operating officer, New Zealand Sotheby\u2019s International Realty.<\/span><\/p>\n

\u201cInventory levels are down, so our drive now is to get more listings,\u201d Hall says. \u201cWe want to be ready\u2014domestic demand and global geopolitical turmoil are driving homebuyers our way.\u201d<\/span><\/p>\n

New Zealand\u2019s prime minister, Christopher Luxon, announced that \u2028foreign buyers can now purchase homes valued at NZ$5 million (US$2.9 million) and above, according to a September 2025 report by Mansion Global.22 Previously, they could only buy property if they invested at least NZ$10 million (US$5.8 million) in government-approved assets. Only overseas homebuyers from Australia and Singapore were exempt.<\/span><\/p>\n

\u201cThis will reopen the doors to international homebuyers who are \u2028already looking at New Zealand and the region for property,\u201d Hall says. \u201cWe\u2019re seeing significant recovery in international visitor numbers, reaching around 87% \u2028of pre-pandemic levels. The majority \u2028of them are Australians.\u201d<\/span><\/p>\n

Hall also says the New Zealand Sotheby\u2019s International Realty website \u2028is recording increasing numbers of international visits, particularly from \u2028the U.S., which indicates that the policy change will have a positive impact. \u201cThis \u2028is particularly relevant to us, as we are the only truly global real estate brand in the market and can open doors to vendors in \u2028a way no other company can.\u201d<\/span><\/p>\n

In the meantime, there has been a big increase in demand from local homebuyers for lock-and-leave holiday homes close to the Queenstown central business district and for rural properties with space, privacy and access to outdoor pursuits, because prices are still below their peak values. <\/span><\/p>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n<\/div><\/div>\r\n\t\t

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Prices in California are among the highest in the U.S. This house in Newport Beach, California, is on the market for US$27.4 million<\/p><\/div>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n

Market transitions require\u2028global expertise<\/h2>\r\n
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The Sotheby\u2019s International Realty brand\u2019s global network enables it to provide coordinated guidance across real estate markets, ensuring clients understand comparative value and opportunity, whether they\u2019re considering domestic or international properties, White says. \u201cOur affiliated agents\u2019 expertise becomes particularly valuable during market transitions. For home sellers, we develop strategic pricing approaches by analyzing current market activity and homebuyer preferences. Properly priced luxury properties continue to attract strong interest.\u201d For homebuyers, the Sotheby\u2019s International Realty brand provides market insights to help them identify value and recognize opportunities.<\/span><\/p>\n

Sales volumes in 2026 will likely depend on pricing discipline\u2014accurately priced luxury real estate inventory should continue to move, while overpriced properties may stay on the market for longer. The biggest differentiator will be scarcity and location quality, with properties in supply-constrained markets maintaining their premium pricing power.<\/span><\/p>\n

\u201cWhile I don\u2019t have a crystal ball, in June 2025 NAR projected home prices to grow by 4% in 2026, and the luxury real estate market has historically shown resilience during periods of broader uncertainty,\u201d White says. \u201cI expect luxury properties in premier locations to continue commanding premiums.\u201d\u00a0<\/span><\/p>\n

 <\/p>\n

 <\/p>\n

\n
Article originally shared by Sotheby’s International Realty in the 2026 Luxury Outlook Report<\/a>.<\/h6>\n\t<\/div>\r\n<\/div>\r\n\r\n\r\n\r\n\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n<\/div><\/div>\n","protected":false},"excerpt":{"rendered":"Luxury real estate holds its appeal as an investment\u2014and a lifestyle. Whether driven by economic opportunities or the desire for...","protected":false},"author":237480086,"featured_media":5269,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"{title}\n\n{excerpt}\n\n{url}","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"_wpas_customize_per_network":false,"jetpack_post_was_ever_published":true},"categories":[765166367,765166251],"tags":[765166368,765166370,318499075,343480,272858,765166369],"class_list":["post-5267","post","type-post","status-publish","format-standard","has-post-thumbnail","category-765166367","category-luxury-outlook-report","tag-2026-luxury-outlook","tag-global-real-estate-market","tag-liv-sothebys-international-realty","tag-luxury-lifestyle","tag-luxury-real-estate","tag-record-breaking-sales"],"aioseo_notices":[],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/livsothebysrealtyca.blog\/wp-content\/uploads\/2026\/02\/content.jpg?fit=2000%2C1332&ssl=1","jetpack_likes_enabled":true,"jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/peJ6Dp-1mX","jetpack-related-posts":[],"_links":{"self":[{"href":"https:\/\/livsothebysrealtyca.blog\/spu\/wp-json\/wp\/v2\/posts\/5267","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/livsothebysrealtyca.blog\/spu\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/livsothebysrealtyca.blog\/spu\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/livsothebysrealtyca.blog\/spu\/wp-json\/wp\/v2\/users\/237480086"}],"replies":[{"embeddable":true,"href":"https:\/\/livsothebysrealtyca.blog\/spu\/wp-json\/wp\/v2\/comments?post=5267"}],"version-history":[{"count":11,"href":"https:\/\/livsothebysrealtyca.blog\/spu\/wp-json\/wp\/v2\/posts\/5267\/revisions"}],"predecessor-version":[{"id":5382,"href":"https:\/\/livsothebysrealtyca.blog\/spu\/wp-json\/wp\/v2\/posts\/5267\/revisions\/5382"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/livsothebysrealtyca.blog\/spu\/wp-json\/wp\/v2\/media\/5269"}],"wp:attachment":[{"href":"https:\/\/livsothebysrealtyca.blog\/spu\/wp-json\/wp\/v2\/media?parent=5267"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/livsothebysrealtyca.blog\/spu\/wp-json\/wp\/v2\/categories?post=5267"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/livsothebysrealtyca.blog\/spu\/wp-json\/wp\/v2\/tags?post=5267"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}