In 1929, the world experienced the Great Depression, and from 2008 to 2009 it went through the Great Recession. In 2016, however, it experienced the Great Correction. Last year marked the first time in history that luxury homes prices scaled back rather dramatically, independent of downward economic pressure. Overall change in the luxury goods market Luxury goods, as a whole, are experiencing a similar reversal of the runaway luxflation -- or continual inflation of the luxury value of goods -- that, until recently, was unjustifiably raising prices to unreasonable levels. While the cost of living a luxurious life has historically outpaced inflation by about 200 basis points (the Forbes’ Cost of Living Extremely Well Index (CLEWI) tracks annual luxury inflation), the effect over the last several years had been outsized. According to BCG, sales of luxury goods rose 11 percent from 2010 to 2012 and seven percent in 2013, but the last several years have seen a relaxation of...
- While the Great Recession was detrimental for homebuyers, the Great Correction is getting real estate back to where it was.
- Despite their impressive wealth, luxury consumers are very cautious spenders who don't mind putting the breaks on a expensive purchase.
The real estate event of the summer
Connect with other top producing agents at Connect SF, Aug 7-11, 2017