The luxury market in the US, generally defined by homes with price tags starting between $1.750M – $2.5M, used to be described as a tale of two coasts. Today, instead of location, location, location, the luxury market tale is being defined by lifestyle.
Coldwell Banker Global Luxury just released its annual findings about luxury markets and luxury home consumers in “The Report: An Annual Review of Luxury Real Estate in 2017.” Charlie Young, Coldwell Banker’s president, said, “We were pleased to uncover many up and coming luxury hubs across the country including tech towns like Raleigh-Durham and cultural capitals like Nashville…”
Shaking things up in the luxury market are places such as Brooklyn, Dallas, Seattle, Sacramento and Marin County in CA. These five places are among the top ten fastest growing primary luxury market sites. Brooklyn, Seattle and Marin County have grown by 12-30% year over year thanks to new development sales and increased demand from Chinese buyers.
The top five power luxury markets to watch for sellers in 2018 are Denver, Nashville, San Francisco, Silicon Valley and Seattle. The top five power luxury markets to watch for buyers in 2018 are Boca Raton, Miami, Park City, Scottsdale and Santa Barbara.
Luxury markets that have increased more than 20% during this last year in CA, CO, NY and Hawaii are
- Maui – 32.73%
- Eagle, CO – 31.29%
- Kings, NY – 30.33%
- Kauai – 25.11%
- Honolulu – 21.79%
According to Craig Hogan, president of Luxury of Coldwell Banker Real Estate, “High net worth money is moving from more expensive cities to ones with lower luxury median prices as mobility and accessibility increase…these buyers want to be closer to action, they want to lock up and leave and go…and you can’t do that if you own a 10,000 or 20,000 square foot home with fountains. The trend is, moving forward, lifestyle trumping location.”
Interestingly, The Report shows potential grown in 14 of the 20 Amazon HQ2 finalists, with or without Amazon’s presence in any of these cities. (Amazon HQ2 finalists include Atlanta, Austin, Boston, Chicago, Dallas, Denver, Fairfax VA, Los Angeles, Miami, Montgomery County, Nashville, New York City, Raleigh and Washington DC.)
Luxury homebuyers want smaller homes, perhaps two or three or five smaller homes, in “happening cities” that are “fully equipped” with smart technology. The Report’s main message… “Being able to take advantage of cultural, recreational and tech hotspots around the country, regardless of where these hotspots are, is the ‘new normal’ in the luxury market particularly now that luxury home market prices have leveled enough overall…after the explosive eight year post-recession housing boom.”