Luxury Portfolio International recently released their newest study, "State of Luxury Real Estate", focused on consumers in the top 1%-5% income bracket of 17 countries, representing more than 30 million households. It was conducted by the Affluent Consumer Research Company, a full-service market research and voice-of-the-customer organization, specializing in high-income and high-asset consumers around the world.

Peabody & Smith Realty, as members of Luxury Portfolio, are proud to help share this study with you now - click here for your copy to read online or download and print.
  Here are some key findings as reported by the study and Luxury Portfolio International:

• More than 15.5 Million Affluent Households across the Globe are in the Market for Residential Real Estate over Next 3 Years, According to a Study by Luxury Portfolio International.
• Conversely, the report also revealed that demand for purchasing residential real estate by this sector far exceeds the number of sellers, with slightly more than 10 million looking to list their home for sale.  

The more than five-million-home gap between those interested in purchasing and those interested in selling creates a seller's market within the overall high-end residential real estate market.  The implication of this lopsided market is near-term price increases and greater demand for new development. 

 Other highlights from State of Luxury Real Estate include: 

• While real estate prices vary dramatically from country to country, a viable luxury threshold is homes in excess of US $1 million.  Of the 15.5 million consumers who indicated interest in purchasing residential real estate, 66% of that segment (10.3 million consumers) noted a desire to purchase a residence valued at US $1 million or more over the next three years. 
• Real estate is the leading investment category of the day, with luxury buyer sentiment a strong 'buy,' and a low inclination to 'sell.' 
• One-quarter of global luxury buyers have an investment or a rental property in mind for their next purchase. 
• The pandemic has impacted homes at all price levels, including the luxury sector, with trends borne from quarantining including adjusting to all members of the household working from home; a heightened need for self-reliance at home; and recognition that spontaneity brings a welcomed break.  For the most part, all three circumstances can be addressed within a luxury home setting.
• Luxury buyers are planning for extended shelter-in-place scenarios for themselves, family and guests. Expectations are high that over the coming year, more time will be spent at home, with about half of luxury buyers seeking a residence with accommodations for long-term guests. Whatever their individual reason, the result is preparation for non-household members to shelter with them. 

The luxury customer is more interested in high-quality offerings and customer service than low price. The ultra-luxury segment values brands that feature corporate citizenship, reputation and loyalty. 

• While real estate as an industry has had significant technological disruptors such as online agencies over the past few years, luxury buyers overwhelmingly prefer to work with a traditional brokerage firm. 70% of luxury buyers noted as much, with 19% noting they would work with an online agency. 
• Luxury buyers are bullish on the residential real estate market. 45% of those surveyed believe that it is getting stronger (more buyers) -- compared to 31% who believe that it is softer (these results are impacted by in-market, in-country specifics). 
• 60% of affluent consumers expect an increase in their current home's value, primarily in the 1% to 10% range.   
• 50% of luxury buyers believe that now is a good time to buy real estate, being the number one result in the survey -- beating out stocks, private equity and gold, among others.  
• More than one-half of ultra-luxury buyers (52%) perceive their current home value to have risen by more than 10%, perhaps incenting them to trade up or add to their portfolio.
• As to an outlook for 2021, barring unforeseen economic or geopolitical issues, a record number of affluent households will be in market to acquire, especially within the luxury segment.
  
  
  To learn more about the Luxury Real Estate market in your area, feel free to call one of our Peabody & Smith Realty agents today - proud members of Luxury Portfolio International.