In July, we’ll survey the changing luxury real estate market, talk to top producers and offer advice on how to level up — all leading to the gathering of the year, Inman Luxury Connect, Aug. 2-3 at the Aria in Las Vegas. Make plans now to join us there.
July 1 marks the start of Luxury Month at Inman and we’ve got a ton of luxury-focused content lined up for readers, from the changing definition of luxury as climbing prices have impacted the U.S. market to how best to work with clients as real estate navigates a market shift and more.
We’ll also highlight the top luxury real estate sales since our last roundups in October 2021 to see who landed the biggest deals and where. On Tuesday, watch for the biggest city deals to go live; on Wednesday, the biggest mountain and ranch deals; then on Thursday, the biggest beach deals will go live just before we release Inman’s list of the biggest overall deals of 2022 thus far on Friday.
From $190 million penthouse sales to $100 million islands, 2022 has been loaded with big deals, and SERHANT.’s director of market intelligence, Garrett Derderian, says the luxury sector should also finish out the year strong.
“Generally in the market, as we look at the country as a whole, we do expect the very high end of the super-prime market to do well for the rest of the year,” he told Inman. “Of course, there may be a slog, a slowdown, or a pause as we near the midterm elections … just because there’s some uncertainty in the market and then once the election passes, the results are known and people are more certain what the policies will be regardless of who wins. Once the outcomes are known, we tend to see a pickup in the aftermath, so the fourth quarter should do very well for luxury sales.”
Here’s a quick preview of what’s to come as we kickoff Luxury Month at Inman and what trends have emerged from these mega sales so far in 2022.
City buyers still debate over LA versus NY
The top luxury city sales in Inman’s forthcoming roundup are evenly split between New York City and Los Angeles, which doesn’t come as too much of a surprise.
But New York buyers show a clear preference for brand new or almost-new developments in the city with the priciest deals earning their place largely because of prime location. For instance, in the biggest transactions of the year, billionaire investor Daniel Och sold his penthouse at 220 Central Park South for $190 million, about twice the amount he purchased it for only about three years prior.
With its prime real estate on Billionaires’ Row, mere steps from Central Park, the building has seen several significant sales in the past year.
Still, the number of ultra-prime luxury properties (those priced at $50 million or more) sold in Manhattan during the first half of the year was down from recent years, Derderian pointed out to Inman, which points to a supply shortage even if there’s still significant activity in the luxury market in New York at-large.
“In the first half of the year in Manhattan, there were two transactions that sold for $50 million or more, and that’s actually the lowest number of transactions since 2014 when there were also two,” Derderian said. “The average is about four-and-a-half every six-month period, so we have seen a slight pullback.”
Size was the name of the game in Los Angeles where many of the year’s top deals thus far have been on properties ranging in size from 20,000- to 40,000 square feet large — or more. Nile Niami’s “The One,” which finally sold at a no-reserve auction in March for $126 million after years of construction delays and trouble finding a buyer, was one such enormous property, at 105,000 square feet.
Aspen dominates mountain sales
Aspen swept the biggest mountain sales of the year, landing four out of the top 10 mountain sales since October, as luxury buyers expressed a desire for ski-in ski-out properties.
Christy Thompson, daughter of late Texas oil exec J. Cleo Thompson, actually accounted for two different top sales in Aspen this year when she sold her downtown Aspen mansion for $60 million, only to purchase another luxury property a few miles outside of the center of town for $51 million.
Her new home includes a primary bedroom featuring a system that pumps oxygen into the room to combat the effects of altitude sickness, which is pretty attractive in a city that sits at a roughly 8,000-foot elevation.
Although prices in Aspen have shot up in recent years because of high luxury demand and little inventory, the market couldn’t beat the priciest mountain and ranch deal in recent memory which was a 340,000-acre ranch in southwest Montana that sold to Rupert Murdoch for $200 million in the final weeks of 2021.
Palm Beach continues to outperform other beach markets
When it comes to hitting the beach for a primary or secondary home Palm Beach and other southern Florida markets continue to be the hottest for luxury buyers.
Palm Beach’s South Ocean Boulevard, in particular, saw a number of high-end transactions this year as did Manalapan, a barrier island town a few miles south of Palm Beach, which still resides in Palm Beach County.
Luxury beach market buyers also showed a preference for spec homes, newly renovated homes or properties with substantial land value and the potential to build something new.
In one such case, Phillip Ragoon, founder of tech company InterSystems, purchased three adjacent lots in Golden Beach, Florida, in one combined deal for a total of $93 million. According to the sellers’ agents, Danny Hertzberg and Jon Mann of the Jills Zeder Group at Coldwell Banker Realty, Ragoon plans to raze the three modest homes on each of the lots and build a new single-family home on the combined properties.
Some buyers are toe-dipping
Luxury buyers are becoming more willing to test out the waters of a new market by either renting or buying a property in a different city for a period of time to see how well they like it, Diana Sutherlin of Compass on the Gold Coast told Inman recently.
“They’re kind of coming out of New York City, having not ever thought they’d leave New York, but they’re sort of trying out being very close proximity and then they’re buying second homes, they’re buying places down at the beach, out in the country,” Sutherlin said.
A more extreme version of this type of test-it-out approach occurred with the priciest deal to hit Palm Beach thus far this year. Billionaire internet entrepreneur Jim Clark and his wife, Kristy, decided about one year after buying 2000 S. Ocean Blvd. for $94.2 million that they were still New Yorkers at heart, so they went ahead and sold the property for $173 million. Previously, the couple thought they would start spending more time in Florida with the purchase, but ended up enrolling their kids in New York schools and recommitting to the city.
Turnkey homes are king
With supply chain issues and labor shortages still plaguing the industry, one of luxury buyers’ top priorities this summer is finding a turnkey home.
That preference is reflected in the spec homes, newly renovated homes and new developments which have surfaced on Inman’s top deals lists, as well as anecdotally from luxury agents.
Tiffany Curry of Tiffany Curry & Co. Realtors at Berkshire Hathaway HomeServices in Houston said she’s working with several luxury buyers to build custom homes that include all of the available upgrades.
Likewise, Stan Ponte of Sotheby’s International Realty in New York City said luxury buyers are taking the idea of turnkey to the extreme by purchasing properties fully furnished and making offers on anything else within the home they find attractive.
“What we’ve been seeing, especially at the ultra-luxury level, is buyers literally buying everything,” Ponte told Inman for a previous story. “The furniture, the china, the curtains, the television on the wall, everything. So essentially, there’s a bit of a trend towards a turnkey purchase, where the old phrase used to be, ‘Just bring your toothbrush,’ and I think there’s a little bit of that.”