Luxury Properties

Quick Takeaways

The luxury home sector is less affected by economic changes than the rest of the market, most likely due to a higher rate of cash purchases, less dependence on the job market, and buyers with more geographical flexibility.
Desired amenities are not what they used to be – the pandemic brought outdoor space and home offices back to a premium not seen in years, while an increase in “staycations” have tied pools with offices as the second most popular amenity.
Currently, the luxury market is hottest in the Southern United States. Both Austin and Miami have seen huge growth, replacing the classic luxury destinations of California and New York.

Source: 7 Luxury Real Estate Market Trends & How to Buy a Luxury Home in 2022 (2022)

In 2022, 12% of repeat and first-time homebuyers had household incomes of $200,000 or more, while 20% of first-time and repeat home buyers bought homes priced at over $500,000. Additionally, 8% of first-time and repeat home buyers purchased homes over 3,501 square feet.

The luxury housing market has not quite faced the same level of upheaval the rest of the market has seen in the past few years. More cash offers mean less buyers worrying about high interest rates and a volatile economy. One of the hottest luxury trends is purchasing a large swath of land out west, while the southern United States is still the hottest luxury destination.

Working with luxury buyers requires its own set of skills and knowledge. Familiarizing yourself with luxury trends, brands, and even hobbies will help set yourself up for success in the luxury sector. Luxury buyers are looking for vacation-like backyards, at home offices, and restaurant worthy kitchens.

See References for more information.

References

NAR Library & Archives has already done the research for you. References (formerly Field Guides) offer links to articles, eBooks, websites, statistics, and more to provide a comprehensive overview of perspectives. EBSCO articles (E) are available only to NAR members and require the member's nar.realtor login.

Facts About Affluent Homebuyers

Percent of first-time and repeat buyers with household incomes of $200,000 or more: 16%
Percent of first-time and repeat buyers who bought homes 3,501 sq ft or more: 9%

Source: 2023 Profile of Home Buyers and Sellers

The Luxury Property Market

10 U.S. Cities Where Luxury Home Prices Are Skyrocketing to New Heights (realtor.com®, May 19, 2024)

“While the median U.S. home list price rose from about $320,000 to about $430,000 over the past four years, the most expensive slice of the housing market has seen greater appreciation, with prices rising from around $1.5 million to about $2.2 million.”

Globally, Luxury Home Prices Are Rebounding (Mansion Global, May 10, 2024)

“The rebound in global housing markets is continuing, as evidenced by our Prime Global Cities Index reaching 4.1% annual growth,” said Liam Bailey, global head of research at Knight Frank. “Rather than heralding a return to boom conditions, the index indicates that upward price pressures are stemming from relatively healthy demand, set against continued low supply volumes.”

How to Sell Luxury Real Estate in a Slow Market (RIS Media, Jun. 22, 2023)

Mortgage Rates Drive All-Cash Purchases to Nine-Year High (Mansion Global, Jun. 7, 2023)

“A home buyer who can afford to pay in all cash is weighing two potential paths,” Redfin senior economist Sheharyar Bokhari said in the report. “They can use cash to pay for the home and avoid high monthly interest payments, or take out a loan and pay a high mortgage rate. In that case, they could use the money that would have gone toward an all-cash purchase to invest in other assets that offer bigger returns, which could partly cancel out their high mortgage rate.”

Marketing to the Millionaire: Profile, Preferences, and More

9 Luxury Real Estate Marketing Ideas for Agents in 2024 (Fit Small Business, Mar. 26, 2024)

Develop client personas, leverage high-quality photos, utilize exclusive channels, create a compelling narrative, host exclusive events, invite other real estate pros to spread the word, implement strategic social media marketing, invest in advertising space, and create a real estate website and landing page.

The Multimillion-Dollar Condo Fit the Bill—But It Was the Faux Plants That Sold It (The Wall Street Journal, Sep. 26, 2023)

“Staging no longer ends with couches, bedroom furniture and fresh flowers; it has to include display luxury candles, branded blankets and oversize coffee-table books that aim to give listings an aspirational feel. They incorporate labels such as Diptyque and Assouline, known to the most discerning clients.”

How to Sell Luxury Housing in a Slow Market (RIS Media, Jun. 22, 2023)

“The luxury real estate market ebbs and flows. That’s simply the nature of the industry. Finding success as a luxury real estate professional means being able to ride the waves and always coming out on top. By putting these strategies into practice, you’ll be able to continue selling luxury real estate—even in a stagnant market. From there, you’ll build trust and rapport with your clients, leading to more referrals that can help you further grow your business when the market inevitably picks back up again.”

Want to Sell Luxury Housing? Act Rich (Florida REALTORS®, Mar. 31, 2022)

“Luxury real estate agents should understand and adapt to their affluent clientele’s mindset in order to serve them better – and reap significant rewards. The first thing to understand: Affluent clients expect high-end marketing materials, a professional website, and other details that mirror their own lifestyle. Driving a nine-year-old Toyota Corolla to meet a multimillionaire at the airport, for example, might not project the correct image. Agents that spend more on these elements increase their earnings potential.”

eBooks & Other Resources

eBooks.realtor.org

The following eBooks and digital audiobooks are available to NAR members:

12 Secret Luxury Home Buyers Know (Audiobook, eBook)

The Luxury Strategy (Audiobook, eBook)

Luxury Brand Management (Audiobook, eBook)

Selling Luxury (Audiobook, eBook)

Selling Luxury Homes (Audiobook, eBook)

Books, Videos, Research Reports & More

As a member benefit, the following resources and more are available for loan through the NAR Library. Items will be mailed directly to you or made available for pickup at the REALTOR® Building in Chicago.

Selling Luxury Homes: Become the Preferred Real Estate and Trusted Advisor to High-end Clients in Your Market (Windsor, CT: Tide-Mark Press, 2010)

The World of Luxury Real Estate (CreateSpace, 2007)

Rich Buyer, Rich Seller: The Real Estate Agents Guide to Marketing Luxury Homes (Institute for Luxury Home Marketing, 2003)

Trading Up: The New American Luxury (New York, NY: Portfolio, 2003)

Have an idea for a real estate topic? Send us your suggestions.

The inclusion of links on this page does not imply endorsement by the National Association of REALTORS®. NAR makes no representations about whether the content of any external sites which may be linked in this page complies with state or federal laws or regulations or with applicable NAR policies. These links are provided for your convenience only and you rely on them at your own risk.