Finding Gems in the Luxury Real Estate Market

What are some of the factors driving the heated luxury Real Estate Market?

Market was not saturated: The luxury high end market was not oversaturated with inventory like other markets. This created a good balance between supply and demand. With many wealthy buyers entering the market from all over the world, this drives up the demand, and the price, of the most sought after addresses.



Cash rules: The luxury market does not depend on mortgages to close the deals. Most buyers in this market use all cash to fund their transactions. Therefore, this market did not get affected by the sub prime mortgage collapse.

Foreign buyers: With the U.S. dollar weakening, foreign buyers from Japan, United Kingdom, and Dubai are using their stronger dollar to find “bargains” in the U.S. luxury market. In New York City, real estate brokers are gearing marketing campaigns towards foreign buyers. They are even recruiting multi language speaking realtors to help with the sales of these homes.

The rich got richer: The wealth of the top 5% of income earners is growing steadily at a rapid pace. The gap between the high income and the middle class is getting wider and wider every year. According to Census data, middle income families saw their wealth increase just 7% in the last 15 years. The richest 5% of the population saw their wealth grow by 40% over the same period.

Price is no option to the ultra wealthy. They will continue to buy what they want when they want to. The luxury real estate market continues to see no boundaries.