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A new study reveals that ultra-high-net-worth individuals (worth $30 million or more) are on the lookout for residences that offer both a luxurious lifestyle and strong investment potential. A quarter of these affluent individuals in the U.S. are planning to purchase residential properties this year, with an average of four homes already in their possession, one-quarter of which are located outside their home country.
According to the Douglas Elliman and Knight Frank Wealth Report, lifestyle and investment opportunities top the list of priorities for these elite buyers, followed by considerations such as taxes and safety. Despite challenges faced by the luxury real estate market, including low supply and rising prices, interest rates stabilizing and the possibility of falling rates this year hint at potential growth in luxury supply, potentially leading to increased sales.
Miami emerges as the top-performing luxury market in the U.S. for 2024, with an expected price growth of 4%, followed by New York (2%) and Los Angeles (1%). Globally, Auckland, New Zealand, leads the pack with projected price growth of 10%, followed by Mumbai (5.5%), Dubai (5%), Madrid (5%), Sydney (5%), and Stockholm (4.5%).
Last year, the world’s top 100 luxury real estate markets recorded an average price gain of 3%, with Manila, Philippines, experiencing the highest growth at 26%. Conversely, New York and San Francisco were among the worst performers, with prices declining or remaining stagnant.
Ultrawealthy American buyers are increasingly exploring overseas markets, with U.S. buyers becoming prominent purchasers of ultraprime properties in London and showing increased interest in European markets like Italy, France, and Portugal.
However, the purchasing power of $1 million has diminished in both the U.S. and abroad. In Monaco, the world’s most expensive real estate market, $1 million buys only 172 square feet of prime property, highlighting the premium prices in top-tier markets worldwide.