Luxury buyers are gravitating away from the grand estate and toward properties with lots of amenities and little maintenance.
International buyers of luxury real estate are disappearing in New York City, and prices have fallen dramatically of late, but, overall, experts in the field still believe the high-end real estate market is in good shape, panelists at Inman Luxury Connect in Beverly Hills said Wednesday.
Nikki Field, a team leader at Sotheby’s International Realty in New York, said Wednesday morning that prices for luxury properties this year are down almost 40 percent while volume has fallen almost 61 percent. Worse still, and related to the falling numbers, international buyers — who helped drive up prices in the Manhattan market over the past decade — have largely disappeared of late.
“They’re gone,” Field said. “They’ve gone off to other opportunities.”
Though that paints a dire picture of the luxury market, Field actually had an overall upbeat message for attendees at Wednesday’s conference.
“The luxury market is doing just fine,” Field added.
Field explained that while international buyers are less enthusiastic these days, agents in her market still “have product and we have opportunity and we have a lot to be excited about.” She also said her team is focused on the “home grown” market, which is making up somewhat for the relative dearth of international buyers.
Those home grown buyers are also buoying up other markets as well. Jason Oppenheim, president of the The Oppenheim Group in Hollywood, said that international buyers have never been as big a deal in his market — which happens to be doing quite well by the way.
“We’re stable,” Oppenheim said, explaining that in his market prices and days on market have been holding relatively stable over the past several years.
Oppenheim went on to say that in the Los Angeles area, interest in and prices for condos have actually seen an “uptick” recently, in some cases driven by buyers from other cities who want a “turnkey lifestyle” rather than a standalone home.
That preference for housing with more amenities and less hands-on maintenance may also be a trend in the luxury market. Field said that there are large estates in her region, but that today many buyers would rather beef up the diversity of their real estate portfolios than have fewer bigger homes.
“They do not want a landscape bill for the grand estate,” she explained, adding a moment later that luxury buyers today are “paring down the size for an easier, fun lifestyle.”
Oppenheim made a similar observation about his market, saying that condos — which are constantly setting new price records in the L.A. market — give buyers access to pools and restaurants and bowling alleys, among many other things.
The point, both agents agreed, is that the market is changing.
“Consumers have changed their goals,” Field said, “they’ve changed their buying styles.”