October is Luxury Month at Inman. All month, we’ll be talking to top producers from across the country, offering advice on how to join their ranks, and more. That all leads up to Luxury Connect at the Aria Hotel (Oct. 25-26, 2021, join us) and the live presentation of the Inman Golden I Club honorees for this year.
2020 was a highly unusual and unique year in more ways than one. While a global pandemic stopped the world in its tracks, it was a record year for real estate with people on the move — and the luxury market played a major role in making this happen.
As a result, an entirely new set of trends emerged with buying and selling. Old rules, myths and beliefs about the high-end market went out the window as a new set of buyers redefined luxury and wrote their own rules.
Sellers had a change of priorities, often choosing to give up legacy properties in exchange for new living adventures and experiences. So, here are eight luxury buying and selling trends you can’t ignore today.
What do you luxury buyers want?
1. Buying for space or privacy
Get out — way out. If buyers had to quarantine, they wanted to go where they had space, and lots of it. Ranches, self-containing compounds and estates were high on the priority list.
This trend is still continuing as buyers are looking for a comfortable place to be able to spread out and live, work and play as well as safely be able to host family and friends amidst the backdrop of COVID-19.
2. Views, views, views
If they had to be on lockdown or quarantined after getting exposed to COVID-19, luxury buyers didn’t want to feel confined to four walls of a property.
They wanted to have a view — something to take their minds off the stress and focus their thoughts elsewhere in an inspiring environment. Properties with views of water, mountains, valleys, golf courses became in high demand.
3. Turnkey properties
Today’s luxury buyers want it all, and they don’t want to do any work. Well, they might because they can, but they don’t want to buy something that they can’t move into and have immediate use of without having to tackle a major redo.
With all of the uncertainty surrounding COVID-19 and various contractors coming in and out of a home during a renovation, not to mention delays in the supply chain causing major disruptions with building materials and appliances, buying a project is not the main priority in the luxury space today, unless the buyer is an investor.
A large-scale renovation could take several months and require a ton of carrying costs. Today’s luxury buyers are drawn to turnkey and move-in ready properties.
Seasoned luxury property owners have likely gone through many renovations throughout their lives, and they just want to spend their time enjoying the property without it being under construction. Younger luxury buyers are even more attuned to instant gratification, so if the property is well-appointed, they’ll gladly buy it with the furniture if they can.
4. Extended living arrangements
Buying a home that can aptly accommodate family being able to stay for an extended period of time — or perhaps even live there permanently — is also important in the luxury space.
Casitas, guest houses and attached or detached apartments on the property are also important to today’s luxury buyers. In short, buyers today expect their luxury homes to have enough space for guests, even if they don’t host people that often.
5. Health, wellness, green and clean
This trend has been written about many times since the onset of the pandemic, but it bears repeating. Buyers are focused on properties and communities that offer amenities related to health and wellness.
There is nothing like being able to work out in the safety and privacy of your home gym, Peloton or yoga studio, or seek solace in your own meditation room. In addition, wellness has come into play with communities that offer access to on-site medical services as well as concierge offerings such as a nutritionist or personal trainer.
Aside from health and wellness, there’s also a renewed focus on properties that incorporate sustainable materials as well as systems that allow for filtered and purified air and water. Lighting systems that can help circadian rhythms are also a desirable feature.
Today’s luxury buyers are all about technology. They are expecting their homes to be tech-savvy to fit their lifestyle. Think: electronic vehicle charging, home automation and the ability to have multiple TV screens in one room. Sophisticated home-office setups equipped for Zoom meetings are a must-have, especially if they’re distanced from the hustle and bustle of the household.
For luxury buyers who work with audio or video, an in-house production studio with a green room is growing increasingly popular for public speaking, presentations, social media platforms, etc.
Think of young, affluent social media influencers who make some serious money from their YouTube and TikTok accounts all day long. They need a well-designed space to get creative and crank out their content.
Ditto for a professional audio suite for podcasting and of course, a recording studio if the buyer has any musical aspirations.
7. Good spaces
The mega mansion with numerous rooms that go on forever, multiple formal gathering rooms, the grand bridal staircases, formal maids quarters, etc. is out. Today’s luxury buyers are all about space for the way they live.
Of course, they still want and desire a lot of square footage, but it has to make sense. It has to be livable and usable — not just a bunch of rooms they’ll never use.
Self-containing compounds or estates allow luxury buyers to stay within the confines of their property if desired and have every need brought to them, instead having to leave the property for things. Extensive outdoor space that brings the inside outdoors is also highly desired for additional enjoyment of the property.
8. Car Storage
Having a spacious garage that can house a buyer’s car collection is a must. Luxury buyers often choose to drive different cars depending on what they are doing and where they are going.
Some may be for errands, others for going out, some for going for a simple ride and others may be used for hauling things. It’s not unusual to find at least one electric vehicle in their car collection, let alone several sports and antique cars.
What do you luxury sellers want?
When it comes to selling, there are also several luxury trends that have emerged over the last year.
1. Cashing out
Today’s sellers are sitting on some serious equity. Many chose to give up their long-time property to cash out and do something different. Maybe it was just too large or required too much upkeep and maintenance.
With their families grown and on their own, many luxury owners are taking advantage of optimal market conditions and low inventory. They usually have other properties they can go to while they figure out their next move.
2. Desire to explore
Many luxury buyers are selling their properties to allow themselves to become more flexible and mobile, particularly younger buyers who aren’t tied to a specific area.
They may want to travel or set out to have unique life experiences instead of being tied down to a property that requires a ton of maintenance and overhaul.
3. Buying multiple properties
Speaking of exploring, luxury sellers may opt to buy a couple of properties after selling their large one, homes that are a bit more manageable and turnkey in multiple locations.
The uber-wealthy love to have real estate that allows them to transition between beach, mountains, desert or a lake or river. They may seek out lesser-known areas away from the crowds of more popular destinations.
Luxury sellers may consider being based in quaint, small towns for example, places they wouldn’t have gravitated toward in the past. Many like the idea of moving into an area that’s under the radar and getting involved in the community by using their passions and talents. They like being able to use their wealth for charitable works.
4. Moving closer to family
After being isolated from loved ones over the last year, many luxury sellers are choosing to sell their homes to be closer to family. They’re trying to figure out a place to live where their adult children and grandchildren are based.
They may purchase property for family or provide financial assistance so everyone can easily move closer together. Or they might consider buying secondary homes in a desired destination that would give their families and extended families the ability to get together more often.
5. Political and tax-related moves
After years of living in high-cost, high-tax areas, some luxury owners are opting to sell and leave areas they’ve lived in for along time to better align themselves geographically with a location they feel that matches their beliefs and political ideology.
As a result of the pandemic and lockdowns, some luxury sellers looked to states that had and currently have less restrictions, as well as those coupled with less tax burden. States with no income tax have fared quite well with an influx of wealthy people fleeing more costly areas in favor of more financial and pandemic-related freedoms.
6. Young entrepreneurs and retirees
Where does the time go? Can it really be that some Gen Xers are going to be retiring? Those that have done well for themselves are choosing to do so, many wanting a change after the pandemic.
This means selling their house and perhaps relocating elsewhere something larger. At the same time, there are many young guns who have founded or sold some sort of company and can run their business from anywhere, hence freeing themselves of the traditional living arrangement where they had to be located near their company.
Now, they can live wherever they want — and so can their employees. They will simply meet virtually with their team, and should they need to engage in person, they’ll travel as needed.
7. Post-closing occupancy
Just like regular folk selling today, many luxury sellers may need to stay for a predetermined time after closing. However, usually, that’s due to different reasons, such as previously scheduled trips and other obligations that won’t enable them to move and have everything wrapped up by the closing date.
8. Vacating before market
It is not uncommon for luxury sellers to completely vacate their home and have zero personal effects in the house when they come on the market. Unless they wish to sell the home furnished, a huge trend is to have it substantially staged, thus removing any sense of personalization or potential identification by buyers of who the sellers were, particularly if the home was owned by notable people.
As we move out of the pandemic, it will be interesting to see how these trends evolve and what will be next for luxury buyers and sellers. The way we live, work and play as been significantly impacted by the events over the last year which will continue to be drivers of luxury consumer behavior as far as how and where they choose to live.
Cara Ameer brings a unique perspective to real estate as a bicoastal agent focusing on the Southern California and Northeast Florida markets with Coldwell Banker. She is an award-winning Realtor, real estate media commentator, author, columnist, industry thought leader and speaker. Because a real estate transaction can be a confusing conundrum for all involved, Cara is inspired by takeaways and lessons learned from numerous encounters, conversations and interactions about all things real estate. Cara enjoys sharing her unfiltered insight and perspective in the hopes it helps enlighten, empower and inform agents and consumers alike.