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The luxury real estate market is changing, and it’s all about who’s buying and what they’re looking for. Baby boomers (ages 60–78) are dominating the housing market, making up 42 percent of buyers and 53 percent of sellers.
This is a massive shift from millennials, who now only account for 29 percent of buyers (a record low). Boomers are in a strong position to buy, often without financing, thanks to the equity they’ve built up in their homes, and about half of boomers are purchasing homes in cash.
The average age of first-time buyers is now 38, and their share of the market has dropped to just 24 percent. While many younger buyers are delaying homeownership due to financial trouble, their influence is not unseen; in-law suites and properties that offer flexible spaces are becoming in demand, accommodating multigenerational living.
Even though they’re waiting longer to buy, many have built up substantial savings or secured high-paying remote tech jobs. These younger generations are now entering the market with the ability to invest in more luxury homes.
To them, luxury doesn’t just mean big square footage and fancy finishes; it’s all about smart technology, sustainability, and versatile living spaces. Features like accessory dwelling units (ADUs), home office sheds and energy-efficient systems are now highly sought after. These buyers aren’t just purchasing homes but changing the very definition of what luxury means.
Tech-savvy buyers are redefining luxury
We are seeing tech-savvy buyers, specifically younger ones from Asia and the Middle East, who have built wealth through the tech industry and startups, and are now bringing that innovation mindset to the real estate market. These buyers are looking for the latest in smart home technology.
Smart homes are no longer a neat, futuristic idea; they’re a necessity. Security systems, climate control, automated lighting and voice-activated assistants are now basic features buyers expect.
In fact, 44 percent of Americans looking for move-in-ready homes say smart home technology is non-negotiable, and it’s no surprise that 61 percent of millennials feel the same way. So, if you’re looking to attract today’s luxury buyers, you’d better be ready to embrace the latest in home tech.
Since the pandemic, technology has been increasingly influencing the luxury real estate landscape. Buyers are prioritizing homes that offer privacy, space and luxury amenities, such as home offices and health-focused features (like a standing desk or cold plunge). As remote work continues to grow in popularity, the need for a home that suits this lifestyle also increases.
Sustainability in luxury living
Sustainability is becoming the new expectation in luxury real estate. Buyers are now seeking eco-friendly homes that align with their values, and developers are beginning to take notice of this trend. Sustainable living is revolutionizing the design and marketing of luxury properties, proving that “green living” is no longer a niche but a mainstream trend.
Remote work redefines luxury
Remote work has fully renovated the way people think about home design. Almost 14 percent of the entire U.S. workforce, approximately 22 million people, are now working fully remote, and most people prefer to work from home at least part-time. The more time people spend in their house, the more they want their house to have all the new perks and look great.
This change has created a boost in demand for homes that are ideal for both living and working. Buyers now seek spacious offices, high-speed internet infrastructure and wellness-focused amenities, such as home gyms and spas.
New features are being introduced into luxury homes, including circadian lighting systems, soundproof rooms, and purified air systems. Buyers are increasingly seeking spaces that promote health, productivity and overall well-being, while also offering the comfort and luxury they expect. This shift is one of the key factors reshaping the luxury market, with more emphasis on functionality alongside opulence.
The luxury real estate market is evolving
With younger generations seeking out homes that reflect their tech-savvy, sustainable and wellness-oriented lifestyles, luxury real estate is becoming more personalized than ever. At the same time, older generations remain a driving force in the market, with a focus on homes that support aging in place and multigenerational living.
This shift is also affecting mid-tier markets, where we’re seeing a rise in prices as wealthy buyers seek to expand beyond major cities. Real estate developers are blurring the lines between luxury and more standard living, introducing high-end design features into more accessible properties. However, while luxury real estate is thriving, this trend also exacerbates the broader housing affordability crisis, making it even more challenging for middle-class buyers to gain a foothold.
As millennials and Gen Z continue to take center stage in luxury homeownership, the industry will have to adapt to meet the needs of these buyers, who demand more from their homes than just luxury; they want spaces that align with their values, needs and ambitions.
With remote work becoming a permanent fixture and sustainability at the forefront, the future of luxury real estate is exciting, and we can expect to see tremendous growth in demand in the coming years.
Lindsey Harn is an agent with Christie’s International Real Estate Sereno and a certified Divorce Real Estate Expert. Connect with her on Instagram and LinkedIn.
