The Luxury Housing Market Wrapped Up 2023 With Both a Bang and a Whimper
The international luxury housing market has remained remarkably resilient amid higher-than-usual interest rates and lingering economic uncertainty. Indeed, by the end of 2023, the sector logged some of the most expensive transactions (and listings) to date.
This past year, sales of London homes priced at £15 million and above (or $18.9 million) jumped an impressive 25 percent, with 54 deals amounting to a collective £1.3 billion, according to a new wealth survey by Beauchamp Estates. Additionally, the British capital saw a whopping 137 percent increase in new-build apartment deals priced at £15 million-plus and a 10 percent boost in billionaire buyers. “London continues to hold its own on the world property stage despite rising competition provided by locations such as Dubai, Miami, and the South of France,” said Jeremy Gee, managing director of Beauchamp Estates.
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In the U.S., New York City closed out the last week of the year with 10 high-end home sales, which totaled roughly $94 million, according to a new report from Olshan Realty, and there was a notable 9.1 percent uptick in deals in the $20 million and above price range compared to Q4 of last year, Coury Napier, director of research at Serhant, told Mansion Global. Napier added that Manhattan’s trophy home market brought in $530 million in 2023, a hefty 37.6 percent increase from 2022.
Additionally, Compass’s senior managing director, Elizabeth Ann Stribling-Kivlan, wrote in the brokerage’s Q4 Manhattan report that “the luxury price brackets for properties over $5 million saw double-digit year-over-year growth of almost 30 percent for newly signed contracts, coupled with twice as many ultra-luxury homes at $20 million and above going into contract this quarter.”
However, in Los Angeles, there was actually a significant drop in ultra-luxury home sales, according to a report from Douglas Elliman and Miller Samuel. Last year, only 232 residences in the $10 million and above range were sold, a whopping 37 percent decline compared to the 370 that changed hands in 2022. The downturn can be attributed to several different factors, including rising interest rates, the Hollywood strike, and the area’s newly enforced mansion tax. There were also fewer ultra-luxe listings on the market, suggesting that some high-end sellers stayed on the sidelines.
Nonetheless, wrote Stribling-Kivlan, “Though there is a lot to look forward to in the residential market for 2024, a stable economy is what helps facilitate transactions” and “if inventory returns to surplus levels and rates drop, buyers will act accordingly and finish making the purchase they’ve been putting off.”
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