The luxury real estate market is estimated to generate a revenue of $4,263.7 billion by 2025, according to a new report by Grand View Research Inc. Whether you are an investor, buyer or real estate professional, stay one step ahead with these four luxury real estate trends this year.
Millennials rent as a lifestyle choice
Pew Research Centre has found that from 2016, only 37% of millennials occupied homes they owned, compared to more than half of early baby boomers being homeowners by the same age. Young professionals are drawn to cities, renting rather than buying homes.
This has lead to a build-to-rent movement, with premium buildings offering modern amenities like outdoor spaces, gyms, parking and recreational activities. For those looking to invest in buying properties in cities like London, Paris, New York or Dubai, the build-to-rent movement is one that seems to be growing.
In an Emerging Trends in Real Estate report by PwC, it was found that there is a demand for more flexibility among occupiers.
“The days of buying real estate, holding it for 20 years and doing nothing, are long gone”
– anonymous Global fund manager
‘Try before you buy’ homes
Potential buyers of mega-luxury mansions are being offered a chance to ‘try before you buy’ before fully purchasing. Last year, tenants of a lavish house and adjoining apartment opposite Buckingham Palace was asked to pay £47,000 a week for a test run of the Grade II-listed Victorian property.
Once convinced, the full price would be £76.5 million. This option is ideal for ultra-wealthy international clients who are thinking about either relocating to London or having the residence as a holiday home.
Smart homes and technology
Modern home buyers are now looking for technology integration within the home. Clients are becoming increasingly familiar with Alexa, Echo and fitness apps, helping them to lock doors remotely, clean the house, as well as save on heating and energy costs.
Companies like hOM are hopping on this technology trend by offering fitness and social events for whole properties. The apps allow tenants to know about events in the building, with internal calendars that makes for convenient booking. Information on signing leases, common spaces and rules are all accessible through the software.
Similarly, the Battersea Power Station residences use The Power Club app that helps build community by connecting to other neighbours, joining groups like book clubs, as well as being connected to Concierge Plus.
The year of wellness
David Bistricer, founder of Clipper Equity clarified the trend saying:
“People are very much focused on, as they have been, gym-related things— things that are good for the body.”
Well-being is said to be the mantra of now. Researchers from Florida-based Global Wellness Institute said that the international wellness real estate market is a $134 billion industry. The report found that the number of properties that had integrated wellness had grown 6.4% annually since 2015 and is expected to reach $180 billion in 2022.