The luxury real estate segment in the United States is expected to continue its upward move in 2015 as more wealthy investors plan on buying big in the coming twelve months, a new survey by Coldwell Banker previews International program found.
The survey, of people worth $5 million or more, found that 48 percent of wealthy individuals plan on buying a luxury home in the coming 12 months.
The study found that millennials (those aged 18 to 35) would account for the larger chunk of luxury home sales with about 81 percent planning to buy a home in the same period. The cohort was also the largest spender among other age groups paying an average $7.8 million for a property.
The survey also highlighted some gender differences in the luxury home buying activity with more women saying they expect to buy a home next year. Forty six percent females said they would make a big home purchase next year - up from the 31 percent recorded last year. Twenty two percent women spent more than $10 million on a property as opposed to just 13 percent of the men spending in the same bracket.
The report noted a significant change in the features these wealthy investors were looking for. Location didn't count as the top priority when it came to buying a luxury property. Instead lifestyle considerations like being able to work remotely, access to amenities etc came out as most favored features.
Green homes or "LEED" certified homes were also in demand among the wealthy buyers with about 45 percent of the surveyed respondents saying it was important to them.
The survey also identified areas in the U.S. with the most number of luxury home sales valued above $1 million. Below are the top five: (list courtesy:realtor.com)
1. San Francisco: 2,485 ( number of homes valued at $1 million and above)
2. Los Angeles: 2,170
3. New York: 2,145
4. San Jose, Calif.: 1,119
5. Houston: 981
The survey comes just days after RealtyTrac, the famous property intelligence firm, released its luxury home sales report that claimed that sales of high-end properties increased 10 percent on a year over year basis.
A May report by property firm Redfin also showed that luxury home sales surged 21.1 percent since January 2014 and 35.7 percent since a year ago.
"It's the investor and the wealthy individual that's keeping the market alive," Mark Zandi, chief economist at Moody's Analytics, told The New Zealand Herald in an earlier interview.
"The wealthy buyers in particular are fully engaged now. The stock market is up and times are good for them," he added.
