Low interest rates and strong financial markets expected to keep the heat under big-ticket sales, but not for all prime housing hubs.
Demand for single-family homes, private outdoor space and enough room to work remotely will drive robust luxury home sales in 2021—benefiting some of the world’s top luxury markets more than others.
There is now ample data from around the world to support what began as mere speculation nine months ago: That the global Covid-19 pandemic would spur an unprecedented shift in lifestyle choices and housing needs, marked by an overwhelming preference for larger houses, more amenities and less population density.
“We expect the luxury market to perform well,” said George Ratiu, senior economist at realtor.com. With economic recovery underway, a vaccine boosting confidence and a strong stock market, a so-called “wealth effect” will drive the “upper end of the consumer market,” he said.
Meanwhile, a willingness, and even enthusiasm, among major employers to offer remote work or greater flexibility to employees long-term has cemented what might have been housing trends contained to the pandemic into market shifting forces.
That means 2021 will be a strong year for cities with ample single-family housing stock, preferably on large lots, as is the case in places such as Los Angeles, Sydney and greater Miami.
Meanwhile, San Francisco and New York City face a slower recovery, though one that’s on the horizon as vaccines and increased travel bring vibrant urban centers back to life.
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