As we head into 2020 one thing is for sure: the luxury home market is not what it used to be. Mega mansions, luxury ranches, penthouses, and other sprawling estates just aren’t motivating today’s luxury home buyers. The Institute’s last few Luxury Market Reports showed that luxury buyers across all ages are looking to downsize in favor of quality over space.
At the same time, it’s worth noting that while there’s a noticeable shift in luxury real estate market trends, it doesn’t mean that every luxury home buyer or seller is the same. It’s still incredibly important to take cues from your clients and dig into your local market trends, but being aware of the bigger picture will help you better advise your clients.
With size and grandeur less in focus, location, and lifestyle have become more important to today’s luxury home buyers. While it’s true that the luxury market has always been about these things, they’re starting to mean something different.
Location, Location, Location
Our September Luxury Market Report showed that today’s luxury home buyers are more interested in owning smaller properties in more locations. They’re also becoming less particular about those locations needing to be in tried-and-true luxury destinations like Los Angeles and New York, as long as they’re able to.
Just because real estate market trends show that buyers are gravitating towards walkable, urban areas doesn’t mean that you’ll find yourself in one of those markets. If your particular market doesn’t necessarily fit the “hipsturbia” mold that’s drawing millennials and baby boomers alike, you can still leverage real estate market trends to your advantage by dissecting what they mean and finding those underlying meanings in your own market to highlight.
For instance, while the rising popularity of walkable cities is partly due to a desire to reduce the environmental impact of frequent car usage, it’s also due to a desire to stay more active. If you’re in an area that’s more spread out and isn’t the most walkable, what are some other aspects of that area that play to the desire to stay active? In your listings and even in your social media posts, you can focus on your area’s selection of yoga studios, bike trails, or community centers. Make video tours of your area’s parks, or interview local gym owners about why they love the community to put on your blog.
Breaking down large estates into bite-sized concepts
Another way to start adapting to real estate market trends is taking large estates and breaking them down into less overwhelming commitments. Millennials and aging baby boomers are shying away from properties they feel are “labor-intensive”, as one Business Insider article puts it, and opting for low-maintenance properties that let their location shine.
To cater to those buyers, luxury real estate agents need to be able to repackage the idea of their bigger properties like mega-mansions and luxury ranches into a variety of experiences wrapped up into one rather than one, gigantic estate. A luxury ranch can offer the opportunity to create a public horse sanctuary, while a secluded mega-mansion might be the perfect corporate retreat.
It may take some creativity, but agents should feel comfortable thinking outside the box when it comes to adapting to real estate market trends.
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