The Hottest Housing Markets for the Super Rich in 2024
Image: The Port of Fontvieille Harbor in the Principality of Monaco. (Education Images | Universal Images Group | Getty Images)
The ultrawealthy are not just looking for a place to live, they want a better lifestyle and a strong investment. According to a new study, one-quarter of American ultra-high-net individuals, those with a net worth of $30 million or more, plan to buy a residential property this year. These individuals already own an average of four homes, with one-quarter of their residential portfolio located outside their home country.
The Top Priorities
When considering their next big purchase, the ultrawealthy prioritize lifestyle and investment opportunities. Taxes and safety also play a significant role in their decision-making process.
Luxury Real Estate Market
While the luxury real estate market has experienced challenges like low supply, slow sales, and rising prices, the ultra-high-end segment has fared relatively well. In the United States, there were 34 sales over $50 million last year, down from 45 in 2022 but still significantly higher than pre-pandemic years.
With interest rates stabilizing and a possibility of falling this year, experts believe there are early signs of growth in luxury supply, which could lead to more sales. Liam Bailey, partner and global head of research at Knight Frank, said, “If we do see a pivot to lower rates, or at least more confidence that inflation is going in the right direction, I think you will begin to see inventory building up again.”
The Best-Performing Markets
According to the report, Miami is expected to be the best-performing luxury real estate market in the United States this year, with an expected price growth of 4%. New York ranks second, with an expected growth of 2%, followed by Los Angeles with 1% growth.
Globally, the top market for luxury real estate is projected to be Auckland, New Zealand, with an expected price growth of 10% in 2024. Mumbai ranks second with 5.5% growth, followed by Dubai (5%), Madrid (5%), Sydney (5%), and Stockholm (4.5%).
Image: Elegant adobe-style homes beneath the towering Burj Khalifa in Dubai. (Tyson Paul | Loop Images | Universal Images Group | Getty Images)
The Top Performers and Underperformers
In 2023, the world’s top 100 luxury real estate markets saw an average price gain of 3%. The best-performing market was Manila, Philippines, with 26% growth, driven in part by investors fleeing Hong Kong and China. Dubai ranked second, with 16% price growth, followed by the Bahamas (15%) and the Algarve region in Portugal (12%).
Among the underperformers were New York, with prices down 2%, and San Francisco, which remained almost flat at 0.5%. In terms of prime markets, the biggest decline was in Oxford, U.K., with an 8% drop.
Ultrawealthy American Buyers
Ultrawealthy American buyers are increasingly expanding their horizons and venturing overseas. They are now the leading foreign purchasers of ultraprime London properties, priced above $10 million. These buyers are also becoming more active in Europe, particularly in Italy, France, and Portugal.
The Value of $1 Million
The value of $1 million seems to be diminishing in the U.S. and abroad. In Monaco, the world’s most expensive real estate market, $1 million only buys you 172 square feet of prime property. In Aspen, you get 215 square feet, while in Hong Kong, you get 237 square feet. In comparison, New York offers a better deal with 367 square feet.
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This article was written for Business Today.