The second annual 2022 Luxury Outlook report is an in-depth exploration of high-end residential markets across the globe. In this report, we follow the trends that are likely to shape the coming months across the world’s prime housing markets – from the resurgence of urban cities to the return of the international buyer.
The report examines the signs of a slight shift in frenzied market of 2021, including fewer bids and homes spending more time on the market. Major industry and pandemic-related conditions keeping the market on the sellers’ side are explored: low inventory, material supply issues, and inflation and relatively low interest rates securing luxury real estate as sound investments. As such, most experts predict prices will increase throughout 2022, especially after the slower winter months.
The Future of Big Cities, Hybrid Work and Generational Trends Fules Real Estate Investment
As borders reopen, pent-up demand from international buyers will compete for limited inventory with local buyers. As such, we’ll look into the future of big cities—many of which bounced back more quickly than expected post-Covid lockdowns—as well as how the market is likely to shape up in second-home locations and suburbs, which saw prices skyrocket due to pandemic-related migration patterns.
But if 2020 and 2021 were fueled by remote work, its predicted that in 2022, hybrid work is likely to drive the market, with many looking for larger homes that can accommodate remote work yet remain within commuting distance to their office. The report also explores areas around the world poised for tax changes that may influence buyers’ real estate investment plans.
Millennials are changing the market, too, finally giving up their rentals and buying homes—often with money passed down by their parents. Tech companies—many of which have relocated, expanded their headquarters, or are planning to do so—are affecting the migration patterns of these millennials (and Gen Z, too).
In fact, the strength of secondary and tertiary cities (now often tech hubs) is one of the trends explored, in addition to the popularity of serviced apartments and branded developments as low-maintenance homes; the increased popularity of eco-conscious house buying (think solar energy and electric-car chargers), and even the emergence of cryptocurrency, which is still in nascent stages with regards to buying and selling property, but likely not for long.
This article was originally published on Sotheby’s International Realty’s Extraordinary Blog, and has been adapted for Sotheby’s International Realty Canada.