All posts by Camilla McLaughlin

Super-Sizing Luxury

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With prices for residential real estate hitting and then exceeding $250 million, stratosphere was the word often used in recent years to characterize the pinnacle of the market. This year, prices for the most expensive in the U.S. are holding steady, perhaps moderating slightly (Refer here for last year’s lists). With the ultimate price remaining at $500 million and the lowest of the top 10 at $135 million, down from 2018’s $138.8 million, it would seem “holding steady” would be an appropriate sobriquet this year. 

When the first edition of Ultimate Homes was published 14 years ago, the highest-priced property in the U.S., an extensive estate in the Hamptons with a huge array of amenities including a golf course, was $75 million. The prospect of a $100 million home was denitely on the horizon, but anything nearing a billion was not even on the radar. Yet, for the last two years, the reported asking price for a mega mansion touted as “the most expensive home in America,” has been $500 million; the lowest price among the top 10 exceeded $100 million for the last four years. Geographically, Ultimate stars have appeared in many of the country’s top luxury locales. Recent years have seen a move toward the West with L.A.’s million-dollar meccas dominating the top group. Timeless blue chip estates, many with extensive pedigrees including notable architects, owners and visitors, comprised most of the top 10 in the initial years.

La Follia, Palm Beach, Florida. Photo courtesy of Giles Bradford 

Billion-Dollar Building Lot?

Undeveloped land without a house does not qualify for the Ultimate list, but it’s worth noting that last summer a $1 billion listing was posted in the multiple listing service for a 157-acre mountaintop spread in Beverly Hills. Since then, the price has been reduced by 35 percent to $650 million. Also, not on the Ultimate list is a $150 million parcel, One Enchanted Hill, that was the estate of Paul Allen, also in Beverly Hills. The property has many improvements including roads and two entrances, but the main house was razed.

Many see prospects for the premier market, particularly in L.A., as positive. Three years ago, Gary Gold with Hilton & Hyland sold the Playboy Mansion for $100 million, a record at the time for Los Angeles county. “Ever since then, we’ve seen more really big sales than ever before,” he observes. “The reason I think the ultra-luxury market is going to do well this year is there happens to be product worthy of big numbers. If there is no product available, nothing is going to trade, just because there’s nothing available. And there happens to be enough really nice, expensive big houses that are going to trade.”

Over the last 10 years, wealth globally has had a remarkable surge. Stephanie Anton sees growth in the number of ultra wealthy as a driver pushing the evolution of luxury, particularly in the highest-priced echelons. As buyer profi les evolved, luxe penthouses in new super towers along with newly constructed mega mansions created new residential categories and pushed prices upward. Properties with provenance such as Chartwell and Beverly House, along with classic estates, still have a place among best of the best. The “ultimate trophy and legend cherished for generations” is the way Beverly Hills broker Jade Mills characterizes Chartwell, a Bel Air legend designed by Summer Spaulding in 1930. A French Neo Classical exterior comprised of symmetrical cut limestone imparts a timeless presence. Henri Samuel, whose work includes estates owned by the Vanderbilts, Rothschilds and Valentino, refurbished the interior in the late 1980s. Located in the heart of Bel Air, Chartwell sits on 10.3 acres and is often described as the crown jewel of
Bel Air. 

The property also includes a guesthouse designed by Wallace Neff and acres of manicured gardens. Multiple agents including Jeff Hyland and Gary Gold of Hilton & Hyland; Joyce Rey, Jade Mills and Alexandra Allen with Coldwell Banker Residential Brokerage; and Drew Gitlin with Berkshire Hathaway Home Services California Properties are representing the property. “Chartwell certainly ranks as one of the most prestigious and beautiful properties I have ever represented. Additionally, the acreage is most unusual with four separate parcels and the exceptional panoramic views of downtown Los Angeles and the Pacific,” comments Rey. This property would appeal to a very specific buyer, explains Jeff Hyland, “one who has class, sophistication and taste.” 

Prime Assets

Steller architecture along with extensive and amazing amenities are a prerequisite for every top property. They add value and promote an over-the-top lifestyle, but architecture and amenities alone will not merit prices at the very top. Where they are located still matters and almost every property this year has a prime address. 

“Location is still a top consideration for potential buyers,” says Rey. Also important for long-term value, according to Rey, is the land. Just five minutes from the Beverly Hills Hotel, with over seven acres, Villa Firenze is the largest single property in Beverly Park, the largest collection of single-family mansions to be built in the U.S. in the last 50 years. With its own street, the property is its own Italianate village and includes two guest houses in additional to a 20,000-square-foot mansion. 

Meadow Lane in Southampton, New York, priced at $150 million, offers 14 acres, four separate lots and a 12,000-square-foot main residence as well as a tennis court with a tennis house, two golf greens with golf houses, and a pool and spa house. Harold Grant with Sotheby’s International Realty says the views up and down the Atlantic, in addition to unobstructed views across the bay, will “take your breath away.” In Palm Beach, only a handful of homes reach from the ocean to Lake Worth. La Follia, priced at $135 million, is the only direct ocean-to-lake estate on the entire island, according to Ashley McIntosh, executive director of luxury sales at Douglas Elliman in Palm Beach. “It is one of the most signifi cant properties on the island of Palm Beach,” she says. Italian Renaissance in style, the home is entirely wrapped in cream Coquina coral stone that extends into the two-story foyer. The top fl oor was designed for the master suite, which has “staggering views” of the ocean, along with his and hers baths, each with a balcony and dressing room, overlooking the ocean. 

Villa Firenze, Beverly Hills, California. Photo courtesy of Tyler Hogan. 

Irreplaceable

In nearby Manalapan, a 15-acre estate dubbed Gemini offers approximately 1,200 feet of dune-lined beach on the Atlantic and 1,300 feet on Lake Worth. A series of tunnels, including one that is a 15-foot-wide gallery, connects the two. The site, perched on top of a dune, offers 360-degree views, yet it’s only minutes to Worth Avenue in Palm Beach. In addition to the main house, it offers two, four-bedroom beachside cottages, a seven-bedroom house, and an additional staff or guesthouse, making it a true family compound with more than 30 bedrooms. Like Gemini, many Ultimate properties would be diffi cult to replicate. Agents call them “once-in-a-lifetime opportunities.” Mesa Vista, a massive ranch in East Texas, is another such property. Billionaire Boone Pickens has devoted more than 50 years to transform this 100-square-mile expanse of Texas panhandle into an unmatched oasis and wildlife habitat.

Improvements include 20 lakes over the course of 20 miles. In addition to a 12,000-square-foot main lodge, there is a 33,000-square-foot lodge and several other houses, plus housing for staff. The chapel, a site for both weddings and funerals, is stunning, and a 6,000-foot runway and hangar facilitates getting there. The ranch is listed at $250 million.

“It seems impossible to comprehend all of the improvement made to this property, whether it is structural improvements, water enhancements, landscape or wildlife conservation features. To our knowledge, no other ranch can replicate Boone’s Mesa Vista Ranch,” says Monte Lyons, managing director of Hall and Hall, who is representing the property along with Chas. S. Middleton and Son.

Super-Sizing Luxury

In addition to being the most expensive, The One is also one of the largest homes in the country, with an estimated 100,000 square feet. The estate is nearing the end of a half-decade-long construction process, and agents expect completion in the next few months. It also reflects a new bent for ultra properties, particularly in Los Angeles, which takes the term “trophy property” to a completely new level. In addition to expansive views, a huge number of very premium amenities from multiple pools and elevators to garages, these estates include almost everything a newly minted billionaire might want, taking the idea of a turnkey home to a new level. 

Billionaire, once again No. 6 on the Ultimate list, is priced at $150 million after a $38.8 million price reduction. It’s completely furnished, staffed and decked out with a huge array of indulgent features and additions, including more than 100 curated art installations, two stocked wine/champagne cellars, a multi-million dollar collection of cars in a custom design gallery and a 40-seat 4K Dolby Atmos Theater. Unlike custom homes which are designed for an individual buyer, new mega spec homes are geared toward a group of buyers with a great deal of specificity.

What hasn’t changed over the years are the diverse features of every Ultimate home, although what were once perks are now considered a “must-have,” including all of the tech bells and whistles, as well as privacy and state-of-the-art security. Wellness has always been a consideration, but now expands beyond space for gyms, yoga and massage. Priced at $135 million, 2571 Wallingford Drive is located in another prime Beverly Hills location and offers a one-of-a-kind indoor sports complex with basketball, pickleball, gym, a boxing ring, sports bar and outdoor lounging, according to Ginger Glass with Coldwell Banker Residential Brokerage.

Meadow Lane Oceanfront, Southampton, New York. Photo courtesy of Sotheby’s International Realty.

“These are consumers who can afford anything they want, but that is nothing new. Ultra high-net-worth consumers want it all, and they can afford it all,” says Anton. “Today in the ultra premium category, we are seeing demand for a lot of square footage in a beautiful setting, and/or view lots with fabulous outdoor space for entertaining and plenty of room to entertain guests, among other things. People are looking for homes that meet the needs of their busy, over-the-top, social, connected lives, but also for their home to be a safe refuge to get away from it all.”

On three occasions Joyce Rey sold the most expensive home in the nation, establishing multiple benchmarks for price — in 1978 for $4.2 million, 1990 for $19.9 million, and 2010’s $50 million record. Last year, the highest priced sale was a $110 million oceanfront compound in Malibu, which was also the most expensive sale ever in Los Angeles. So far, 2019 could be seen as a record-setting year, with the sale of a $238 million penthouse residence at 220 Central Park South in New York, which was an Ultimate top property last year. The sale set a record for a U.S. residential property. Designed by Robert Stern and located adjacent to Central Park, the building has become one of Manhattan’s most renowned properties. The price is more than impressive and surpasses other records for the U.S., which include a $147 million estate in the Hamptons that sold in 2014 and Copper Beech in Greenwich, which sold for $120 million also in 2014. Both eclipsed previous records, including a Woodside, California, estate that sold for $117.5 million in 2012.

When it comes to indications of what might occur in the future, and even the correct context within which to understand the present market, a look back doesn’t always provide the best insights. Regarding this year’s recent record sale price, appraiser Jonathan Miller cautions in his blog that the price may not be an indication of future trends because the contract was finalized in 2015, at the height of Manhattan’s supertall and super-luxurious building craze. However, Jeffrey Hyland believes there are several good indicators that bode well for future ultra-luxury sales in California. He estimates a large number of IPOs this year. “All these people are going to have so much money they will be looking to dispose of.”

This editorial appeared in the Unique Homes Ultimate ’19 Issue. 

See the Top 12 list here.

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The Ultra High End’s New Story

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The Ultra High End’s new story: No longer is ultra high-end real estate in the U.S. just about NYC and LA.

Beverly Hills, Manhattan and Miami, along with one or two other cities, have traditionally been the locus of the most expensive and most exclusive real estate in the U.S. Now, in an increasingly diverse geographic mix from Boston to Boulder, more properties align with what the industry calls the ultra or premier market. Uber prices in these locations might not number in the hundreds of millions of dollars, but they are the highest of that market. And, no matter the ZIP code, it’s likely that properties at the very top share similar attributes. 

Worldwide, the number of millionaires and billionaires continues to grow, with the U.S. still accounting for the largest share of mega wealthy. “I think the change we are seeing in the growth in the ultra high-end is directly correlated to the growth of significant wealth in the world. More people have more significant money,” says Stephanie Anton, president of Luxury Portfolio International.

“Interestingly,” she says, “it’s diversifying too. In the U.S., no longer is the story just about NYC and LA. Bottom line, the shift in location is a change that influences the high end of the housing market and the demand for significant properties in a way we have never seen before.”

Photo courtesy iStockPhoto.com / Sean Pavone

 

Traditionally, the very top of the market in Boston was the purview of the city’s legendary Brahmins. But the revitalization of downtown neighborhoods and growth of tech and finance, along with globally recognized educational institutions, are revamping the high end in both the city and suburbs. In 2018, there were 82-percent more luxury property sales than in 2014. Not only are more properties considered high end, but new luxury towers mix with traditional blue-chip estates.

 

Photo courtesy of iStockPhoto / MattGush

Jonathan Radford with Coldwell Banker Residential Brokerage in New England is representing the highest priced estate outside Central Boston. Woodland Manor is a $38 million property on more than 7 acres, five miles from the city centerline in Brookline. Photo courtesy of Boston Virtual Imaging.

The highest listing in the city is a $45 million penthouse occupying the entire 60th floor of the new Millennium Tower. Jonathan Radford with Coldwell Banker Residential Brokerage in New England is representing the highest priced estate outside Central Boston. Woodland Manor is a $38 million property on more than 7 acres, five miles from city center in Brookline. “Over the ast 5 years, we have seen consistent growth in the number of luxury property transactions outside of the city of Boston, in the range of 10 percent to 30 percent per year, with the exception of 2016, when a shortage of inventory resulted in a 2.7-percent decline in the number of luxury sales. In 2018, there were 58-percent more luxury property sales than in 2014,” explains Radford. “In the city, growth in the number of luxury transactions has exceeded 25 percent a year.”

Beverly Hills agent Joyce Rey, head of the Estates Division of Coldwell Banker Global Luxury, has brokered a number of record-setting transactions both regionally and nationally. “I never cease to be amazed at the constant ascension of real estate values. Any look in the rearview mirror at real estate values is always surprising because people realize and regret not buying more real estate. And it seems shocking today because when I founded Rodeo Realty in 1979, $1 million was a pretty major property.” The customary benchmark for luxury in many places has been $1 million. Now, in many locales, including Boulder, Colorado, the $1 million home is basically a redo. Boulder agents say luxury doesn’t begin until $2.5 million,
but even then, as Megan Bach with Colorado Landmark Realtors points out, “some homes are not necessarily luxury.” A more reliable gauge in Boulder, she says, is price per square foot, a measure often applied to premier markets in New York and California. She estimates luxury in Boulder begins at approximately $1,000 per square foot. The highest priced home currently on the market is a $9 million property on 15.42 acres outside of town with extensive views and strong indoor/outdoor connections. Having “great indoor views typically price bumps any home in any neighborhood here, as is the case in any view locale,” says Bach, emphasizing what might be a universal truth for uber luxury: No matter the location, the better the views and outdoor connections, the higher the price. 

Utah ay seem an unlikely spot for the ultra high-end, but prices now approach $10 million with the highest residential listing $26 million. Photo courtesy of Summit Sotheby’s International Realty.

“Sales over $10 million are very rare, but I think they are coming,” observes Debra Johnston, with Berkshire Hathaway HomeServices Georgia Properties. Photo courtesy of Debra Johnston.

Along Florida’s west coast, values in upscale resort locales traditionally trailed Miami or Palm Beach. Now, “prices for beachfront in Naples begin at $20 million,” says Tade Bua Bell of John R. Wood Properties. The recent sale of a gulf-front property in the exclusive Port Royal for $48 million illustrates how much demand has changed. The home was eventually torn down and replaced with new construction. Another property also in Port Royal and destined for a tear down sold for $28 million. In the ultra-sphere, a $10 million or $20 million tear down is not an anomaly.

The uber market in Atlanta starts around $5 million to $7 million for new construction. “Sales over $10 million are very rare, but I think they are coming,” observes Debra Johnson, with Berkshire Hathaway HomeServices Georgia Properties. “Buckhead is running out of large land lots, which is driving up the cost to build a dream house. The time it takes to build a new luxury home in the $5 million range could take up to 2 years. Many prospective buyers are instead buying the best flat lot they can find in a resale, and renovating the house to their taste level,” observes Johnson. In Atlanta, Los Angeles and other cities, lots suitable for prestige properties are at a premium.

In New York City, ultra luxury starts at $10 million, but Martin Eiden of Compass Real Estate says if you are looking for the “Wow factor” you have to be in the $18 to $40 million range. And anyone considering a trophy — what Eiden calls “I made it big” — property, generally has to look at $60 million and up. In the ultra-sphere, trophy properties often have over-the-top list prices. Greenwich, Connecticut, is a blue-chip bastion for prestige properties. Topping price points is a mid-country European style estate offered at $29.5 million, followed by a $22.5 million property, also in a premier estate setting. Old money locales tend to be timeless. In the Washington, D.C., metropolitan area, uber prices currently do not exceed
the $20 million mark. The exception is a $62 million estate in McLean, Virginia, on 3.2 acres overlooking the Potomac and comprised of a main residence and The Marden House, which was designed and constructed by Frank Lloyd Wright in 1959. Also extraordinary is underground parking for 30 cars, bespoke interiors by Thomas Pheasant and some of the finest views of the river in the region. In the ultra realm, truly singular properties, particularly those with provenance, often merit singular list prices. Parking for dozens of cars might seem over the top, but garage space and parking are both important to high net worth buyers, according to Rey. What else is considered a must-have? Smart home tech, larger closets, a gym, kitchens and great rooms that flow, screening and media rooms. But, Rey emphasizes, “Location is still the number one consideration for buyers.”

The increasing diversity of locations in properties at the highest price points is basically a numbers game: more buyers, greater degrees of wealth, and price appreciation in the overall market. Simply, there are more people in more locations with greater net worth. Utah is an unlikely spot for the ultra high-end, but prices now approach $10 million with the highest residential listing at $26 million. The market changed in 2016, according to Kerry Oman, with Summit Sotheby’s International Realty in Park City, who brokered the sale of a $13.5 million property in Provo Canyon, the highest-priced transaction in recent years. For the ultra market, the $5 million to $7 million range is typical, and $7 million to $10 million is no longer the exception, says Oman. In spite of growing national interest in Park City, demand for uber properties is most likely to come from home-grown wealth. In the ultra-realm, U.S. buyers dominate a majority of locations today. 

“A lot of money is coming out of Silicon Valley, and Seattle now. And we’re seeing a great migration of significant wealth to more resort markets like Hawaii, Florida and Texas, due to an aging affluent population and also attractive tax laws,” shares Anton. Taxes are only one driver for a new geographic mix of buyers in Florida and Georgia. Even before the tax law was passed, brokers like Bua Bell were reporting more interest from Colorado and California. Brokers in Naples and other cities are also seeing buyers from New York, New Jersey, Massachusetts and Connecticut. Johnson says there has been a big increase in out-of-state buyers in Georgia in the last year. Ultra-luxury buyers in Greenwich have broadened in terms of their use of these properties and what they are looking for, observes Robin Kencel with Compass Real Estate. Some plan to make Greenwich their fulltime residence. Others are looking for a weekend or a summer retreat. “As people discover Greenwich’s natural beauty, from having four beaches to 600-plus nature trails to a breadth of year-round activities and its sophisticated, diverse and wholesome vibe, it is becoming an attractive alternative to the Hamptons,” she says. 

In the Washington D.C., metropolitan area, uber prices currently do not exceed the $20 million mark. The exception is a $62 million estate in McLean, Virginia. Photo courtesy of Gordon Beal. 

Sui generis is how some characterize the ultra market, but as distant and disconnected as it may seem, the ultra sector does not exist in a separate vacuum. “Everything’s fluid in luxury real estate,” says Gary Gold with Hilton & Hyland in Beverly Hills, noting it’s not like the stock market where there is a definite price at the closing bell. “It doesn’t work that way. There are so many nuances. In general, when you have record sales, when you have record numbers of sales, when you have lots of positive activity, it has an overall significant effect on everything,” he explains.

“The rise in significant prices is a reflection of demand but also is consistent with the rise we’re seeing in luxury prices across the board,” says Anton. “According to Realtor.com, in Q4 of 2018, prices in the top 5 percent of markets in 1,000 U.S. cities closed at an increase of 4.7 percent year over year. It’s a bit of that old saying, ‘a rising tide lifts all boats.’” With pricing heading into the stratosphere, an ultra purchase might seem capricious — a product of desire rather than a well thought
out choice. Instead, no matter the price, it’s still a question of value. Every once in a while a buyer might make a crazy purchase, but agents say that’s a very rare occurrence. Even though prices might be well into the tens of millions, Gold says, “It’s not about the money. It’s about how everyone wants to make a smart purchase, and no one wants to be a chump. For the most part, when they make that purchase, people want to feel they have made a prudent, valuable purchase. People who are worth a lot of money are very used to making very very expensive acquisitions, whether it’s in business or personal.

They know how to wrap their head around these very large purchases.” “These buyers are highly sophisticated consumers and active in multiple luxury asset classes, from cars to art to jewelry. They want to know that beyond enjoying their property, they have made a sound business decision,” says Kencel. Ultra properties might be extravgent and indulgent, but the ultra buyer’s focus is still value and investment. When there are several properties on the market at the highest prices, agents often say, “When one sells, the others will to.” Surprisingly, experience does validate this claim. “If you see homes that are setting new precedent, I think it definitely is an endorsement in an area and a price range,” says Gold. Several years ago, Gold broke the $100 million price point in Los Angeles with the sale of the Playboy Mansion. “No one ever sold something well over a $100 million. Since then, we’ve seen more really big sales than ever before. It’s definitely a validation of an area, and people get more comfortable spending more money, so it’s a good sign.” And the impact trickles down. “The second I sold something for $100 million, all of a sudden the $5 million listings are now worth more.”

This editorial originally appeared in Unique Homes Ultimate ’19 Issue.   

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Cover Story: The Ultimate Compound

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No other property would be better suited for an issue devoted to prestige properties than the palatial waterfront mansion in Coral Gables, Florida, featured on our cover. It’s not often family, Miami and a palatial residence are mentioned in this same sentence, but that’s what makes this property is so spectacular.

The gated community of Gables Estates offers the ultimate in security, including patrols on the water. It’s not unusual to see children out on bikes and neighbors walking dogs here. Nearby are some of the best schools in the Miami. That’s one of many reasons why those who know the area see Gables Estates as one of the best neighborhoods, explains Sandra Fiorenza with ONE Sotheby’s International Realty, who is representing the property.

The 14,443 square foot residence itself offers a huge measure of security with concrete construction and windows that exceed hurricane standards. The exterior is clad with marble, and the same stone — all from a single source — is used on covered balconies and lanais that overlook an infi nity pool and the blue of the wide lagoon. Inside, light dances throughout the home. A neutral palate becomes an ideal backdrop to showcase exquisite details such as Venetian plaster and carved plaster moldings, marble columns and stone carvings. The overall effect is elegant and restrained. 

An extensive master suite with his and her bathrooms occupies one wing of the second floor with an additional four en-suite bedrooms in an opposite wing. The home also has two offices, private staff quarters and a wine cellar. The site on the largest lagoon in Gables Estates also offers access to deep water and the ocean. With a new seawall and 140-foot dock, this could be the ultimate Miami home, as well as a perfect family compound. It’s easy to see why those who know the area see Gables Estates as one of the best places to call home. This Ultimate compound is priced at $25.9 million.

This editorial appeared in the Unique Homes Ultimate ’19 Issue.

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Bringing Wellness Home

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Wellness may be a hot topic, but not everyone is sure what it means.

Every year one topic seems to dominate real estate. This year it’s wellness. Yet, if you ask designers and architects what comprises wellness in he home you are apt to get a variety of responses ranging from connections to nature to spaces for meditation or yoga to air quality. Some might point to certifications such as Wellness Within Your Walls or the WELL Building Standard or biophilic design. Others say LEED and other green certifications address wellness.

“I think health and wellness is still in the ‘public education’ stage of what it means. All last year you’re hearing it more and more and more. But I still think it’s educating the designer,” and the public, says Beverly Hills designer Christopher Grubb, president of Arch-Interiors Design Group. Designers often understand the term as it applies to LEED accreditation or to aging in place, but not necessarily the overall concept.

“It might mean one thing to one person and something else to another,” says designer Allie Mann with Case Architects and Remodelers in Washington, D.C., noting that some might be caught up in the movement without fully understanding it.

“I think that this is really being driven by a lot of consumer behavior. When it comes to the builder-developer world, I think our consumers are much more educated. I think they know what they want. They just don’t know how to get there,” says Angela Harris, creative director and principal of TRIO, an award-winning, market-driven, full-service interior design firm in Denver.

“Health and wellness is a new frontier for all of us, says Jacob Atalla, vice president of sustainability for KB Home. KB Home, along with Hanley Wood, KTGY Architects and Delos, a tech and wellness company, created a concept home outside of Las Vegas in Henderson, Nevada, to illustrate what a home designed with wellness as a core value looks like and how it functions. “It is the home story of the future,” he says.

Even though wellness seems to have suddenly burst onto the housing scene in the last year, the idea of connecting home to health is not new. More than 20 years ago, health issues potentially linked to building materials and toxic conditions such as black mold gained attention, giving rise to the term sick building syndrome. Since then, awareness of the relationship between the built environment and health has been growing. A decade ago, new technologies led to the development of products that either reduced the level of toxic contaminants released into the indoor ecosystem or scrubbed the air of VOCs (volatile organic compounds). Other concerns about noise, water and connections with the natural environment were also beginning to surface. At the same time, health and wellness was becoming an important value for consumers worldwide, expanding beyond fitness to include personalized medicine, mind-body connections, spa, wellness tourism and also the built environment.

By 2015, wellness had morphed into a $3.7 trillion industry worldwide, according to the Global Wellness Institute, and climbed an additional 6.4 percent annually to reach $4.2 trillion in 2017. One of the fastest growing sectors in the wellness space is a category called Wellness Lifestyle Real Estate, which includes everything in the built environment that incorporates wellness elements in design, construction, amenities and service. In addition to physical well-being, wellness real estate also addresses social wellness and mental, emotional and spiritual wellness.

The biggest difference between homes designed to promote wellness and homes that address air quality or other environmental factors that impact physical health is that wellness is integral to the design and permeates every aspect of the home from floor plan to amenities. “Overall you are programming the home to be more livable,” says Harris.

Frustrated by the lack of attention to the ways in which indoor environments influence health, Phil Scalia, a former partner at Goldman Sachs, founded the initiative that eventually became Delos, which has been on the forefront of wellness in the built environment for more than 10 years. In 2014, Delos established the WELL Building Standard, which was initially applied to commercial buildings. Over 1,200 projects in 45 countries, across over 250 million square feet of commercial real estate, fall under the WELL umbrella. The WELL standard focuses on seven categories of building performance: air, water, nourishment, light, fitness, comfort and mind. Additionally, it takes connections between a building and the surroundings into consideration.

During groundbreaking work on EcoManor, the first LEED Gold certified single-family residence in the U.S., designer Jillian Pritchard Cooke discovered that both consumers and design and construction professionals lacked accurate information on how to reduce toxins in the interior environment. That was the inspiration for Wellness Within Your Walls, another wellness certification that offers education on building and designing healthier interior environments. The focus is on materials both for construction and also furnishings and finishes.

Another more recent wellness initiative centers around the principles of biophilic design and the benefits of bringing natural elements into buildings. In 2016, Amanda Sturgeon, a biophilic design expert and CEO of the International Living Future Institute spearheaded the Biophilic Design Initiative. In addition to designers, builders and architects, current proponents include tech companies who have added natural elements to buildings to increase productivity and reduce stress for workers.

This year, it’s fair to say wellness is coming home as attention shifts from commercial to residential applications. The KB ProjeKt Home takes wellness in residential structures to the next level. Not only are established practices regarding connections with the outdoors, indoor toxins and air quality embedded in the design, but a synergy with smart home tech transforms wellness from a passive attribute into one that is active.

“The motivation was to examine how we can make the home healthier and at the same time how do we engage that home in partnering with the occupants, with the people living in it, to enhance their health and wellness or engage them in making the environment they live in better. We know that about 90 percent of our lives are spent indoors, and a lot of that indoor living is in your own home,” Atalla explains. Recent research from Hanley Wood shows that homeowners believe housing is essential or extremely important to good health, and two-thirds say the right housing environment could cut annual medical costs by 40 percent.

Central to the home’s wellness quotient is an innovative smart system, dubbed DARWIN, developed by Delos. This first of its kind, home wellness intelligence network constantly monitors the home environment and interacts with and adjusts systems in the home as needed. A network of sensors built into the walls — there are nine in the ProjeKt Home — constantly tests air quality.

If it detects problems with air quality, containments or chemicals from everyday products, DARWIN directs the climate control systems to bring more fresh air to that room. Water quality is also monitored, and purified water is delivered to every fixture in the home. “You have a wellness intelligence system that is constantly doing things on your behalf to increase your wellbeing,” says Atalla.

The system also monitors the plumbing system and alerts homeowners to leaks. Sleep is an important wellness component and the master bedroom in this home is primed to promote slumber. Special noise-damping drywall ensures quiet. Motorized shades block out exterior light. “Total quietness, total darkness, and circadian rhythms help you sleep,” adds Atalla.

Lighting is another mainstay of wellness formulas, both natural light from large windows and expanses of glass as well as interior lighting keyed to circadian rhythms. DARWIN adjusts lights to match the time of day. But what makes this function more worthwhile is the homeowner can change the lighting to produce a desired effect, which means the lights can create an energizing morning environment even if morning comes at 5 a.m. on a stormy day.

A living garden wall enables the home to grow herbs and microgreens. Turning the home and kitchen into a place to produce healthy food is an emerging area of innovation for kitchens.

Social interaction is another wellness component, and community design increasingly takes social interaction into account with spaces such as walking trails, parks and coffee houses designed to encourage interaction and encounters among residents as part of everyday life.

It might seem like a big jump to add wellness to typical new homes, particularly production homes, but Atalla says the KB ProjeKt Home is an example of what can be done. Additionally, Harris says it’s often an easy tweak to add features such as water filtration in the kitchen and master bath. “That doesn’t cost a whole lot. And again, I think it’s just about livability and how you’re programming your floor plan to be more livable.”

Looking ahead, most research points to continued growth of the wellness economy, with new initiatives approaching wellness from the perspective of design, construction, materials and function. There are now more than 740 wellness real estate and community developments built or in development across 34 countries — a number that grows weekly according to the Global Wellness Institute.

Right now, the $134 billion wellness real estate market is about half the size of the global green building industry and projections call for the pace to continue. “But the wellness market isn’t just growing, it’s extremely dynamic. We believe that the three sectors that represent the core spheres of life will see the strongest future growth — wellness real estate, workplace wellness and wellness tourism — while other sectors will also grow as they support the integration of wellness into all aspects of daily life,” says Ophelia Yeung, senior research fellow, GWI.

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Realtors Become Agents of Change

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FOR YEARS, NEW TECH COMPANIES HAVE BEEN THOUGHT OF AS THE ‘DISRUPTERS’ IN THE REAL ESTATE INDUSTRY. BUT SAVVY REALTORS ARE POSITIONING THEMSELVES AS THE AGENTS OF CHANGE.

The current market shift from buyers to sellers generates the most attention, but the number of sales and pace of price appreciation are only one swell in the wave of transformation rolling through the real estate industry. Technology is typically hailed as the disrupter, but changing demographics, new lifestyle aspirations and evolving buyer preferences are all at play in today’s real estate landscape.

“If you ask anyone that has been in the business more than 10 years, they say ‘here we go again.’  More paperwork, more platforms, more new companies, more new agents. Yet, ultimately real estate is the same. Our clients require handholding, advice, and moral support, deals get negotiated, and transactions finalize or fall apart. Yes, there are slight shifts in the marketplace, but generally, it still functions the same,” shares Lucio Bernal, a broker associate with Coldwell Banker Residential Brokerage in Palm Springs, who is also an expert trainer with the Institute for Luxury Home Marketing.

What is changing is almost every other aspect of real estate from tools to facilitate broker client relationships to virtual reality apps enabling buyers to envision making a prospective property their own. Increasingly agents are looking to their brokerages to keep pace with technology. “They are leaning on their brokerages, more than ever, to help arm them with tools, from digital marketing to smart, proactive customer relationship management systems (CRMs) that will keep them cutting edge, as well as those they can’t afford to leverage on their own,” says Stephanie Anton, president of Luxury Portfolio International. Additionally, affiliate groups like Luxury Portfolio and major brands have amped up marketing capabilities so agents can easily create a cohesive campaign.

There might be a technology revolution taking place in real estate, but market shifts are reinforcing the importance of the agent. “Technology has always been the present. It’s how you use it that benefits you the most,” shares Bernal. “The perfect example is: If you are dealing with a consumer, they are more likely to use you based on reputation and recognition than whether you know a certain app or technology platform. Technology should be used as a resource and compliment your ability to get face-to-face and maintain contact with a consumer.”

At this time last year, blockchain and the impact of virtual reality and artificial intelligence on real estate were being debated. Today, the chatter is about portals morphing from search engines to places to buy and sell homes, a new classification the industry characterizes as iBuyers. Opendoor, founded in 2013, started the trend, followed by others including Offerpad and Knock. Zillow and Redfin have also introduced iBuying in some markets. iBuyers purchase consumer’s homes outright using analytics that enable them to come up with a price based on the home’s perceived value, usually within days. Unlike homes sought by flippers, these are not troubled properties and offers reportedly are close to the value estimation. Other portals are beefing up offerings for consumers, adding mortgage and title services. Startups such as Purple Bricks offer a new twist on the flat-fee concept.

Investor dollars from venture capital and hedge funds are flowing into real estate, fueling many new ventures, which is another change potentially revamping the industry. “Everyone is investing in technology to disrupt or change real estate,” says Mark Choey, co-founder of Climb Real Estate, a San Francisco brokerage, which was acquired by Realogy’s subsidiary NRT in 2016. The real estate industry is rapidly shifting, and innovation is not just welcome, it’s desperately needed,” said founder Chris Lim, whose background is in marketing. Choey hails from the tech sector. Climb was the first brokerage to work with Matterport and continues to incubate emerging apps and work with new vendors.

ENABLING THE AGENT

Among traditional brokers, Keller Williams and RE/MAX are often noted for new tech initiatives, but almost every brand and national affiliate group is boosting technology offerings and platforms, often through relationships with providers and new tech venders including virtual staging, enhanced CRM and 3D tours and imaging. Technology ultimately benefits consumers, but traditional brands and affiliates say their focus is enabling their agents to do a better job.

“Everything has shifted in many different areas from the brokerage level, the buyer level, who the buyers are, what they are looking for,” says Sally Forster Jones, executive director, Luxury Estates, Compass. “I think there is a shift in the way that brokers are functioning. They are more innovative with more technology and more marketing as opposed to the older traditional real estate firms.

“Consumers care about responsiveness. They care about the fact that if they reach out to an agent, whether it be on their website or mobile app the agents gets back to them instantly, and technology can help with that,” says Marilyn Wilson, founding partner of real estate consultants WAV Group and also a founder of RETechnology.com.

“Technology has always been the present. It’s how you use it that benefits you the most. The perfect example is: If you are dealing with a consumer, they are more likely to use you based on reputation and recognition than whether you know a certain app or technology platform. Technology should be used as a resource and compliment your ability to get face-to-face and maintain contact with a consumer.”

Lucio Bernal

Broker Associate, Coldwell Banker Residential Brokerage

Tapped by Google to create a virtual staging app using augmented reality, Sotheby’s added Curate to agent toolboxes last year. Not only can a homeowner visualize a home before buying, but a partnership with a home furnishings company allows potential buyers to virtually furnish the home as well.

“A depth of understanding of what a property has is really important to consumers. The other thing that consumers are responding to online are floorplans,” says Wilson.

GETTING REAL WITH VIRTUAL

In the last year, GeoVC, a tech start-up offering 3D immersive tours and floorplans that can be created using next generation smartphones, integrated virtual staging, exterior 3D scans, and aerial 360-degree panoramas captured with a drone with interior 3D tours. “Outdoor imagery is captured using a regular drone, automatically processed into a 3D model, and integrated together with interior virtual tour. Such an exclusive experience will differentiate luxury properties with beautiful facades and roofs, and spacious lots,” shares Anton Yakubenko, co-founder and CEO of GeoCV.

“Luxury has really turned into personalization now,” comments Thompson. Tools like Curate, RoOomy and virtual staging apps enhance opportunities for personalization. Thompson explains: “Someone can walk into a home and say, ‘not my style,’ but it doesn’t matter because I have the tools that allow me to make it feel like what I want it to be.”

Even Compass, which touts itself as “The first modern real estate platform, paring the

industry’s top talent with technology,” says technology is there to benefit the agent. “Compass is building for the agent. Every program, tool, and service is (created) with the agent in mind. Many of the other real estate technology companies out there are working to improve the consumer experience and not focusing on the agent. We believe that by empowering the agent, consumer experience will be improved,” says Sarah Vallarino, head of West Region Communications at Compass.

“Talking to agents, the message we consistently heard was ‘give us technology,’” says Thompson. “They didn’t necessarily know what that technology was just that they needed it. They understood that the industry was changing, and consumer behavior was changing. They know because they’re the boots on the ground and so they can feel the shift in consumer behavior.”

As markets shift, agents are retooling, once again looking at how they do business and what skills and knowledge will be required. “It’s always either somewhat of a buyer’s market. It’s somewhat of a seller’s market. You just have to have your tools in your tool shed and the mindset to be nimble enough to adjust as you read the tealeaves, ” is Wilson’s suggestion.

“Luxury has really turned into personalization now,” comments Thompson. Tools like Curate, Ro0my and virtual staging apps enhance opportunities for personalization. Thompson explains: “Someone can walk into a home and say ‘not my style,’ but it doesn’t matter to me because I have the tools that allow me to make it feel like what I want it to be.”

AGENT PIVOTS

“Many long-time successful agents are being the clever, resourceful entrepreneurs that they are and changing with the market as the market shifts,” says Anton. “Agents today talk about how much of their time and value derives from being an educator for their clients. They partner with their clients to keep them armed with as much information, insights and insider activity as they can, so when it comes time, for example, for an agent to recommend a price reduction, the client is completely aware of the statistics, days on market, what is moving and what isn’t. Nobody wants to have an overpriced home that is sitting and not selling even in a hot market.”

“Today, clients will attempt to collect their information on their own, perhaps from incorrect sources, so agents report pivoting, now more than ever, to spend a lot of their time educating their clients,” she says.

Regarding slowing sales or price appreciation, Anton says: “I highly recommend agents tell the truth, focus on educating their following/clients, and in the process, let their own voice be heard and be themselves. If the market is cooling, share the stats and manage expectations. It’s not the time to be overly positive and cheery as you will come off inauthentic and salesy. Focus on the facts, insights and provide professional guidance.”

“Agents have to stay on top of what is available to them and the consumer. It is imperative to be able to explain the data, to have polished negotiation skills, and to know when to assist the consumer in processing that information,” says Bernal.  

“Agents should take full advantage of all the resources that the brands they work with provide. The majority of agents won’t, and that has never changed. Those that want an edge in the industry recognize that there is value in resources and take advantage of some of them. For most agents, resources are overwhelming, and therefore don’t take the time to learn and use them,” says Bernal.

Thompson recalls, “We had to dig in and find out what exactly is it that they (agents) need that will make a difference for them in their day-to-day because they think, you know, there are lots of real estate brands that tout themselves as technology companies, but they really don’t have anything really different.”

“Everything has shifted in many different areas from the brokerage level, the buyer level, who the buyers are, what they are looking for. I think there is a shift in the way that brokers are functioning. They are more innovative with more technology and more marketing as opposed to the older traditional real estate firms.”

Sally Forster Jones

Executive Director, Luxury Estates, Compass

EYE ON THE FUTURE

Mark Choey from Climb says, “I think you’re going to see a lot of change in the next year or two,” most likely from many directions. Choey is head of Climb’s Innovation Lab. Having an innovation lab, particularly for a small company, is in itself an innovation. “You’re going to have some business models that are going to evolve, like Opendoor and Knock, that are really going to change the way people buy and sell homes, but it’s not gonna change everything, right. You’re going to have Redfin, Zillow and others come out with tools and things that are going to attempt to either reduce the commission or to simplify to transaction. On the other hand,” he says, “you’re going to see traditional real estate firms arming themselves with technology.”

And while some tout themselves as technology companies, Thompson doesn’t see traditional and technology as being mutually exclusive terms. “You don’t have to be one or the other. People think of Sotheby’s as a heritage brand because we’re been around for close to 300 years now. But a heritage brand can also be tech savvy. It doesn’t have to be one or the other.”

Looking ahead, Bernal says, “The real estate industry has to take both a broad look and a hyper-local look at where the marketplace is based on data and individual perspectives. We say that real estate is local, yet there are many determining factors that create a web of interconnected behaviors throughout the world of real estate.”

Consider Los Angeles, Manhattan and Miami, where the impact of fewer international buyers extends beyond sales and prices. Post-recession, international buyers became a market force determining  what was being developed, locations and price points. On the West Coast, view properties and contemporary architecture were particularly favored by Asian buyers, and new builds were often geared to these buyers. Now many L.A. buyers, particularly in higher price points, are local or hail from the U.S. and have different expectations of luxury with walkable locations and neighborhoods taking precedence over views. “That’s a shift and it will continue to be a shift because we have a lot of properties coming on the market geared toward that international buyer,” says Jones.

The desire for the ability to walk to shops and restaurants is happening across all price points, according to Jones, and these new preferences are not limited to L.A. Walkability has been associated with urban settings, but increasingly this characteristic is being applied to suburbs, towns and master-planned communities.

Traffic and gridlock also add to new preferences for locations. In the not too distant future, traffic itself may be seen as even more of a disruptor than it is now, changing where people live and property types.

Photo of Lucio Bernal by Cherie Johnson for Moncherie Fotography. Photo of Sally Forster Jones by Lauren Hurt. Photo of Kevin Thompson courtesy of Sotheby’s International Realty.

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Art-Centric Home is a Work of Art Itself

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A home inspired by art and designed to showcase master works becomes a work of art in itself.

Upscale properties are often conceived to showcase art, but it’s rare to find an estate comparable to the villa featured on our cover. Known as The Chow Residence, the home was built by the legendary restaurateur Michael Cho and Eva Chow. It reflects their passion for art. Not only is it designed to display an exceptional collection, but it could also be considered a work of art itself. Like all masterpieces, this property is the result of seven years of careful curation and construction.

For inspiration, the owners looked to the Reina Sofía museum in Madrid, the curved ceilings at the Pradro, the Lanvin atelier in Paris and the elevators at the Hermés, eventually hiring Mexican architect Humberto Arigas to bring their vision to fruition. Here Spanish architecture, Art Deco, Venetian influences, contemporary art and Chinese antiquities happily mix with 400-year-old Moorish columns and 18th century Florentine ceilings in a diverse palette that seems ideally suited to the magnitude of the structure. The centerpiece is a dramatic two-story, 30-foot tall atrium from which rooms on two levels branch out.

The lower level is devoted to collections and amusements, including space for a collection of vintage cars, extensive wine storage and an underground theater.

Museum quality rooms are only one quality that makes this property exceptional. The location is the best street in the city. “Mapleton Drive is as good as it gets,” says Jeff Hyland, who along with his partner Rick Hilton, is marketing the estate. It is also one of the very few sites in Holmby Hills offering a view of downtown Los Angeles. A rooftop deck is oriented for these premium views, and the addition of a kitchen and a bar make it ideal for entertaining. “You can have 100 people up there,” Hyland adds. Hilton & Hyland is offering the property at $78 million.

This story was previously featured in the spring 2019 edition of Unique Homes Magazine. Click here to view the digital version. 

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Posh and Pre-Loved

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Secondhand has gone upscale.

The names tell the story. The Vault Luxury Resale. The RealReal. Poshmark. Once the domain of nonprofits and local mom-and-pop stores, consignment and resale has become a big business, with new ventures adding a high-end twist to a timeworn model.

Resale, in which retailers purchase items directly from consumers and sell them outright, frequently replaces the traditional consignment model. No matter the method — consignment or resale — items are often not new. Still almost everyone in the business would be hard pressed even to utter the word “used,” instead opting for pre-owned, pre-loved, gently worn and secondhand.

“The attitude about resale has changed significantly over the last five years. The new consumer mindset sees the value in purchasing high-quality, well-made items that can last a lifetime, and our model creates access to these items,” says Rati Levesque, chief merchant for The RealReal, which sells luxury goods online (and in two recently opened brick and mortar stores) on consignment. ThredUp, one of the first online companies to focus on second-hand apparel for women and children, estimates 70 percent of their shoppers, which they often call “thrifters,” have never purchased secondhand before.

Used items from premium labels such as Gucci, Hermes, Louis Vuitton and Chanel have always been in demand, often only obtained through a very small group of discrete local shops. In 1991, Sue McCarthy opened a consignment shop in St. Louis, eventually realizing that purchasing items outright was better suited to her upscale clientele. Today, she heads a multimillion-dollar enterprise, trading the original 400-square-foot storefront for a 7,000-square-foot boutique. Her roster of clients extends worldwide with approximately 15,000 individuals who send items to her. Additionally, along with her daughter who is the company curator and verifies authenticity, she frequently travels to view and purchase items from some of the largest closets in New York, Paris, London and other cities, something she calls “shopping the closet.” Clients include some of the world’s wealthiest women and celebrities, and more than a few stylists have her on speed dial. Also, customers travel to St. Louis to shop in her store. For some, like one group of female lawyers, it’s become an annual event.

 

 

The RealReal began at Julie Wainwright’s kitchen table and is now a major player in online luxury consignment. Following other online merchants, they recently opened stores in Los Angeles and New York and plan to add more brick and mortar locations in 2019.

Julie Wainwright

Photos courtesy of The RealReal.

When it comes to selling secondhand items online, eBay was a game changer and 1st Dibbs broke new ground for luxury sales online. In the industry, ThredUp, which started with a pilot for peer-to-peer online sharing of men’s shirts, established the resale niche online. Now the company claims to be the world’s largest online marketplace to buy and sell women’s and kids’ secondhand clothes.  

James Reinhart, co-founder and CEO of ThredUp says, “There is a powerful transformation of the modern closet happening and I’m proud that resale is a key driver of this transformation.” ThredUp estimates current resale market for apparel at $20 billion and projects the market to grow to $41 billion by 2022. Investors have taken notice. ThredUp, The RealReal, Poshmark and others have captured venture capital. Waiting in the wings as further resale disruptors, according to ThredUp, are depop, Rebagg, Tradesy and Grailed. Additionally, startups such as The Luxury Closet are tapping into a nascent resale market in Dubai.

ThredUp estimates approximately 13 percent of their most active thrifters are millionaires. Several years ago, McCarthy tried an online store but decided a focus on social media would make the best use of their online staff. They have a massive following on Instagram and Facebook, running special sales and events weekly. “We cast a wide net over every product,” McCarthy says. “Once we put an item up it sells almost instantly.”

The industry claims resale benefits the environment and most major players support a charity. But McCarthy believes her process allows wealthy clients to amp up their support of nonprofits. “We’re able to monetize it better for charities,” McCarthy says. Instead of receiving a check or cash for their items, many of their wealthy clients opt to donate the money to charity. “If they give the $2,000 purse to charity, the charity is going to sell it for $200. If they give it to us, we’re going to pay them a thousand dollars. We make the check out to their favorite charity,” she explains. But many opt to take the resale funds and use them to purchase the latest and greatest, underscoring the secret to resale. “The lady who wants the latest Chanel or Gucci bag is going to be the same lady that wants the next latest one. And that gives her a good incentive to sell the previous bags,” McCarthy explains.  

Sue McCarthy

Sue McCarthy pioneered the luxury resale model with The Vault Luxury. Stylists and fashionistas have her on speed dial. And she is called on to shop the most indulgent closets in New York, London and Paris.

Photos courtesy of The Vault Luxury Resale.

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A Look at Today’s Home Offices

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After a period of declining popularity, home offices are back. Sort of.

Ask designers and architects about home offices and chances are the responses will range from “no one wants them” to “we’re including them in every house.”  When it comes to home design headlines, it’s hard to compete with au pair suites and pet rooms, which tend to generate colorful images. Home offices might be humdrum, but they are gaining their share of the spotlight as more individuals spend some time working at home. And the more substantial the work, the more likely they are to look for a private office or work space.

Not too long ago, designers would have told you that home offices were passe as owners preferred to work in various spots around the house. Today, offices are back as a growing number of homeowners and potential buyers tick off a room to work at home, even a private office, on wish lists. The American Institute of Architects’ most recent home design trends survey shows offices as growing in importance, up to 39 percent from 33 percent a year ago. Interestingly, 58 percent of architects say interest in outdoor living, which tops the list of features growing in popularity, is increasing. Au pair/in law suites grew to 41 percent.

“A few years back we had a lot of homeowners requesting desk space in kitchens. We don’t get that as much anymore as people are looking for more private desk spaces that can be closed off from the rest of the house” says Sean Mullin AIA, director of design at Anthony Wilder Design Build in Cabin John, Maryland.“We’re adding office spaces in almost every house these days. I am working with a lot of empty nesters who are keeping additional bedrooms for future resale but converting one of them into a home office. They often want an isolated location for privacy with pocket doors or some other features to close off the room for privacy, while leaving the space otherwise open as a study or formal sitting room,” says Luke Olson, project manager at GTM Architects in Washington, D.C.  

The 20-Hour Work Day

Today many jobs can’t be crammed into a single 8-hour time slot. Traffic and congestion also mean more individuals work at home at some point during the week. “With new technology making it easier than ever before to be in touch with people at any time of the day or night, it’s hardly surprising that workers are demanding that their increased efficiency is offset by great choice of location,” was a conclusion of a recent report from the International Workplace Group, which drew on insights from 18,000 professionals in 96 countries. And for a growing number of affluent individuals, including those opting to make their second homes a full-time residence, their base for work might be the home.

Instead of a completely dedicated individual space, many home offices today might start as a flex space or found space in an alcove, or even under a stairway.

©IStockphoto.com/MonkeyBusinessImages

Tall windows and sunlight make an inviting office in an alcove off a great room.

©IStockphoto.com/KatarzynaBialasiewicz

Among those who are not self-employed, the number of people who regularly work from home has grown by 140 percent since 2005, nearly 10-times faster than the rest of the workforce, according to The American Community Survey and GlobalWorkpalceAnlytics.com. The number of home-based self-employed grew by 7.3 percent from 2015 to 2016, with the number of home-based incorporated businesses increasing by 43 percent since 2005.  The population that telecommutes at least one day a week grew by 11.7 percent from 2015 to 2016, the largest year-over-year growth since 2008.

Even though mega-companies such as Yahoo and Hewlett-Packard have moved away from telecommuting for some employees, approximately 40 percent more U.S. employers offered flexible workplace options than they did five years ago. Still many companies reserve the option for higher-echelon management. Only 7 percent make it available for most of their employees. The globalization of business is an additional catalyst. A number of the Fortune 1000 around the globe are revamping their space requirements, because many of their employees are already mobile. According to Global Workplace Analytics, they are not at their desk 50 percent to 60 percent of the time.

Home Office Demand

Spans All Price Points

While an office or study might be expected in high-end homes, even production builders are carving space for work at home into their plans across most, but not all price brackets. John Burns Consulting’s recent consumer insights survey shows that 16 percent of new-home shoppers work from home full time, and the number goes up to 53 percent for those who work from home one day a week. Shoppers with higher incomes and at higher purchase prices are more likely to work from home at least one day a week.

“This shift to working from home has shifted demand for floor plans and in-home office needs,” observes Jenni Lantz, manager of Design Lens for John Burns Real Estate Consulting.

“While some workers are comfortable just working from their laptop on their kitchen island or couch, many want something more significant. There is demand for formal offices (or at least informal) at all price points, says Lantz, noting only those with a very low purchase price are willing to negotiate on this space.

 

A high percentage of John Burns’ employees work from home, and everyone has the flexibility to work at home if the need arises, Lanz says, pointing to her own experience to illustrate how requirements for office space can change. “When I first started working from home, I had a desk located to the side of my family room. It was miserable. I had no privacy when the family was home, and it was hard to leave work behind for the day. When I bought my house back in 2014, I got a formal office, which made things so much easier. I have a separate formal office just off my foyer with French doors. This allows me to close the doors if needed, but I like the glass since it allows me to be still connected to the world outside if my daughter is home.”

Flex Spaces, Libraries and Niches

Instead of a completely dedicated individual space, many home offices today might start as a flex room or found space in an alcove, or even under a stairway. Home offices also might take the form of a space that can be configured as a workspace but also be repurposed to another function. Michigan architect Wayne Visbeen says he includes flex spaces in many of his designs, which can then be used as an office.

“People need to think about how they are going to use the space over the day and over the course of a lifetime. You want to make sure that space has the ability to morph over time,” shares Ann Thompson, senior vice president of architecture and design at Related Midwest.  

In other instances, architects say they might include a private study that could be a set up as a formal office or a relaxed, but private, refuge. “In many instances we might make the dining room into a library, so it functions as a multiple purpose space,” explains Jim Rill, principal of an eponymous Washington, D.C. architectural firm. Dining rooms converted to a library might showcase a custom table that gives a place to spread out and play games while still available to host that once- or twice-a-year celebration.

“They are home management spaces, which are little niches that can be very charming, very functional, outfitted ergonomically with counters around and space for a printer.”

Photo by Morgan Howarth, Courtesy Anthony Wilder.

A small desk and a daybed ready a secondary bedroom for work or guests.

© Dustin Peck Photography Inc., Courtesy Mary Cook

The size and location of offices in the house may vary by potential use. “It does depend on the stage of life that you are in and it depends on the level of position that you have and the kind of job. But for sure, almost everybody is working from home in some capacity,” says Mary Cook, a principal of Mary Cook Associates, a Chicago-based design firm, noting the appeal spans generations and life stages from busy young moms to empty nesters. “So, I still say that you need a dedicated place, but that place is smaller, and it can now be flexible and adaptable.”

Many are more functional than in the past and often occupy less square footage. “They are smaller, usually 10-by-10, or 12-by-12, or they are home management spaces, which are little niches that can be very charming, very functional, outfitted ergonomically with counters around and space for a printer. We do a lot of those in back halls or off the kitchen,” explains Visbeen.

 

Putting the Home in Home Office

Other owners, say designers, want to make offices welcoming and warm. “Homeowners want the spaces to feel cozy. Incorporating a small gas fireplace or TV in the room will bring out the home in the home offices. Built-ins for books and plenty of windows for views will make it a space in which the homeowner will feel very comfortable working at home,” says Mullin, who explains some owners want a very simple space with just a desk while others might want a full set up with sofas, coffee tables and ottomans.

“Built-ins for books and plenty of windows for views will make it a space in which the homeowner will feel very comfortable working at home.”

Photos courtesy of GTM Architects.

Developers of new towers, whether for condo residences or luxury rentals, also take the desire for home offices into consideration for individual residences and for amenity spaces. Rather than traditional business centers, work areas may be found throughout amenity levels in some new buildings. And depending on the target demographic, they might take the form of community tables, booths, lofts, reading nooks, individual work stations and huddle rooms.

High-end condominium residences might include a library or study near the main gathering spaces as well as one in a secondary bedroom positioned away from distractions. And luxe work spaces such as these in new super towers might even offer panoramic vistas that surpass those in office buildings, giving new meaning to the phrase, view from the corner office.  

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Global Evolution: What’s Changed In Luxury Real Estate Since The 2008 Recession

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In the 10 years since the recession, residential real estate, especially in the realm of higher-priced properties, has morphed into a worldwide enterprise.

“There is no question; people have more of a global mindset. They are looking for real estate in places they love,” says Stephanie Anton, president, Luxury Portfolio International, which several years ago adopted the tagline, “We’re global. We’re local.” The phrase aptly characterizes the status of luxury today.

“The saying goes that all real estate is local, but that does not mean that all buyers are,” said NAR President Elizabeth Mendenhall, CEO of RE/MAX Boone Realty in Columbia, Missouri.

Congeliano, Italy

Photo courtesy of Atlante Properties Luxury Portfolio International®

For the industry, the ramifications of globalization extend beyond merely who buys what, where. “Historically, real estate market dynamics were considered a local phenomenon. In the luxury sector, this is no longer the case, as the value drivers for prime property in one corner of the globe increasingly originate from a completely different region of the world,” explained Christie’s International Real Estate in its 2018 report Luxury Defined, noting this trend is most evident in secondary markets — second home and resort lifestyle destinations. In 2017, sales of resort and vacation homes grew by 19 percent compared to 7 percent in 2016.

Buying property outside of one’s home country is nothing new, but, until the 1980s, sales across borders were generally limited to resort enclaves or a pied à terre in Paris, London or New York, along with the occasional trophy property.

Today, rather than a specific location, high-end buyers are likely to search for a particular property type. “Buyers these days are looking in multiple markets. They’re not as geographically contained. So, if they’re looking for a ski chalet, they could be looking at a number of different countries and throughout the Rocky Mountains in the United States,” shares Laura Brady, president and founder of Concierge Auctions, who says her company initially saw indications of this trend with ranch properties, which are very unique. “Clients don’t care specifically which market they’re in; instead, they want the right property.” Founded 10 years ago, Concierge Auctions has a team in Europe and activity in 18 countries.

Perhaps it’s geography, but Americans typically first look within their own borders. On the other hand, Bob Hurwitz, founder and CEO of the Hurwitz James Company, says, “Wealthy foreign buyers are far more likely to be open minded about locations outside their country as their first choice, in my experience. It’s not difficult to understand if you travel a great deal. In many of the countries I visit on business, you will not find many Americans, but you will meet a wide variety of citizens of other countries.”

More than property and search preferences drive the shift toward a global perspective. “There are several factors contributing to the increased globalization of luxury real estate,” shares Anthony Hitt, president and CEO, Engel & Völkers Americas, who cites the rise of digital, social and mobile technologies. “Real estate is not immune to the changing patterns of consumption enabled by technology; clients have more visibility, and therefore interest, into international homes and listings.”

Experts also point to an increasingly global economy, changing work/life balance and how commonplace travel, for both work and pleasure, has become. Craig Hogan, vice president of luxury, Coldwell Banker Real Estate, plans to exchange his primary residence in Chicago for two small condos, one on Michigan Avenue and another in Puerto Vallarta. “Fifteen years ago, my partner and I never would have considered that. Today, we are mobile. Our careers take us all over the world.”

Falmouth, Massachussetts

Photo courtesy of Robert Paul Properties/Luxury Portfolio International®

“With the world that we live in now, it’s less important that you live where your business is or where you do business. So, you’ve got a lot of people just making lifestyle choices. They’re just picking the city that they enjoy the most, and they’re moving there,” shares Mike Leipart, managing partner of The Agency Development Group in Beverly Hills.

Post-Recession Roots

The foundation for today’s international dynamic lies in the early post-recession years. In 2007 and 2008, prices on average fell by approximately 17 percent across the globe. By 2009, 73 percent of the prime property locations surveyed by Knight Frank had experienced declines, and savvy buyers scoured high-end markets worldwide for bargains. At the same time, a growing uptick in wealth and wealth creation brought more buyers to the international market.

Wealth creation continues at the post recession pace, with the number of millionaires worldwide tallying at 22.3 million, according to Wealth X. Those with a net worth between $1 million and $5 million hold 40 percent of the global millionaire wealth, while the remainder is held by the ultra wealthy, those with a net worth in excess of $30 million (Knight Frank pegs the benchmark for ultra wealth at $50 million). From 2012 to 2017, Knight Frank says the number of ultra-high-net-worth (UHNW)  individuals increased by 18 percent, followed by another 10 percent gain in 2017.

Coldwell Banker Global Luxury estimates 32 million millionaires reside in the U.S. The U.S. remained the dominant nation for wealth in 2017, both among millionaires and the ultra-wealthy, according to Wealth X, although growth of this population and net worth in the U.S. was the lowest among the seven top-ranked countries. Japan was second with an 11-percent rise in the UHNW population, followed by China, Germany, the U.K. and Hong Kong.

Mexico

Photo courtesy of REMexico Real Estate/Luxury Portfolio International®

Globally, wealth in 2017 increased in all regions, with both Latin America and Europe showing a resurgence over 2016. “The confidence of foreign buyers is back,” says David Scheffler, president, Engel & Völkers France. “The Parisian luxury market has always attracted wealthy Middle Eastern buyers and continues to do so. Qatari, Kuwaiti, Saudi and Omani clients are looking for outstanding apartments and townhouses, the so called hôtel particulier. The trend to buy luxury properties in Paris is not just reserved for the ultra-wealthy, but applies instead to a wider range of affluent buyers. Some might look for a small 50- or 60-square-meter pied-à-terre, while others look for ‘representative’ apartments in the Haussmann style, up to 12 million euro.”

Over the course of the last 8 to 10 years, cross-boarder buying surged, ramped back, and picked up again. In 2016, global sales of luxury properties retrenched, partially in response to Brexit, government restrictions on wealth and the transfer of money. Markets bounced back in 2017, with sales of $1 million-plus properties up substantially.

Christie’s reports an 11-percent increase in sales, the best annual increase since 2014. Luxury properties sold in 190 days, indicating more realistic pricing in some markets and lack of inventory in others. Exceptions included New York and Miami, which saw an influx of new inventory and a shift in buyer interest. In Toronto and Vancouver, newly introduced cooling measures from the government slowed sales.

“I don’t think there is any indication that they [international buyers] are NOT looking in Manhattan. The indication is that they are either interested in the properties at lower numbers or they prefer to wait the market out and hope to buy when things are at a bottom (I have seen this many times before. It never works!). Nobody is moving to Detroit because they can’t find what they want in New York City,” shares Frederick Warburg Peters, CEO of Warburg Realty. “Russians and Europeans are far scarcer than they were in 2010 or 2011.”

Still, both for high-net-worth and ultra-high-net-worth individuals, New York follows Hong Kong as the best city for prime properties.  

Nassau, Bahamas

Photo courtesy of Bahamas Realty/Luxury Portfolio International®

Toronto, Canada

Photo courtesy of Harvey Kalles/Luxury Portfolio International®

Following the recession, a growing body of research focused on wealth and global cities publish multiple rankings. A city’s position may shift slightly, depending on the research, but all reports include the same top locations for luxury properties. Hong Kong places ahead of New York in Christie’s 2017 index, with New York moving up to second, followed by London, Singapore, San Francisco, Los Angeles, Sydney, Paris, Toronto and Vancouver.

Lower prices pushed Miami just out of the top 10, but the city remains a good example of the change international activity can spark. “The international market has arguably impacted Miami as much or more than any other U.S. market. The influx of capital from Europe, South America, Russia, China and Asia has permanently changed our community. The easiest example is by simply looking at our booming skyline,” says Irving Padron, president and managing broker, Engel & Völkers, Miami.

The highest-priced sale globally was $360 million in Hong Kong, and despite government efforts to curb rising prices, there are no indications of slowing demand for luxury residences here. Also, adding to this market, according to Anton, is continued interest from mainland Chinese buyers.

Numbers Tell the Story

Rather than sales and prices, the best indication of just how global real estate has become can be seen in the expansion of major brands, affiliate groups, and even boutique firms worldwide. “All brands are connected globally,” Hogan observes, adding that even independents need some kind of a global connection. “It’s part of the dynamic,” he says.

Coldwell Banker is in 49 countries. Sotheby’s International Realty network has offices in 72 countries and territories. Luxury Portfolio International and Leading Real Estate Companies of the World lists properties in over 70 countries. Who’s Who in Luxury Real Estate’s network includes 130,000 professionals in over 70 countries. Berkshire Hathaway HomeServices recently opened franchises in Germany and in London. Bob Hurwitz had already positioned his boutique firm as an international player before the recession. Today, he has offices in Los Angeles, San Francisco, New York, London, Shanghai and Singapore.   

A global orientation can also be seen in members of the Institute for Luxury Home Marketing. There is “an increased focus and intentional approach as they target international buyers through affiliations with brands, networks and associations,” says general manager Diane Hartley. “In fact,” she says, “we have members in many countries outside of North America who are building relationships and sharing business with our members in the U.S. and Canada.”

Whistler, Canada

Photo courtesy of The Whistler Real Estate Co./Luxury Portfolio International

Firms based in Europe also continue to increase their footprint. Founded as a boutique firm in Hamburg, Germany, Engel & Völkers is now in 800 locations in Europe, Asia and the Americas, establishing its first offices in the U.S. in 2007. “We have experienced firsthand the globalization of luxury real estate,” says Hitt.

“For luxury and coastal markets, real estate has absolutely become more global,” shares Leipart. Like a growing number of independent firms, The Agency partners with an international real estate advisory company, Savills, which allows them to sell through 700 offices around the world. Still, he adds, “we are focused on international, kind of connecting the dots around the world as opposed to other cities in the U.S.”

In the luxury world, L.A.’s star continues to rise, and the city in recent years has figured into lists for top global markets. According to the National Association of Realtors, Florida, California and Texas remain the top three destinations for purchases from foreign buyers, followed by Arizona and New York. Still, just under half of all residential transactions for foreign buyers took place in other states. Among buyers, China, Canada, India, Mexico and the United Kingdom account for the most purchases.  

Also, Hogan points out, international buyers in the U.S. aren’t always in luxury markets. For example, Asians love to buy real estate close to a university. Another group looks for locations with smaller downtowns. Still others want a large home with a big yard near a lake or river, something hard to find in their home country.

As Much As Things Change

Even though foreign buying in the U.S. slowed in 2017 compared to prior years and to overall activity worldwide, international buyers still have their sights on the U.S. “It’s all about consumer confidence. As long as people feel that the U.S. economy is in good shape and it’s going in the right direction, they’ll buy real estate,” says Brian Losh, chairman of Who’s Who in Luxury Real Estate.

Connections to local markets remain essential.  “I will say a lot of it still happens in a very traditional way. People are either coming to L.A. a lot, either they have a child in school here, or they love the area and they decide to buy a home, and they do that through a local Realtor, regardless of where they come from,” observes Leipart.

This story was previously featured in the Global 2018 edition of Unique Homes Magazine.

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Nuances: The 2019 Luxury Outlook

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Usually, it’s possible to sum up the outlook with a pithy phrase, but this year the luxury landscape is nuanced. Some markets sizzle; others simmer. Dynamic outside forces are at play and will potentially exert even more influence in 2019. In the background, the words recession and bubble are whispered, but most experts don’t see either in the cards, particularly for residential real estate in 2019.

“In most markets, I think it’s a case of ‘from great to good,’” says Stephanie Anton, president of Luxury Portfolio International.

“We’ve left a crazy market, and we’re moving into a more normal market,” shares John Brian Losh, chairman of Who’s Who in Luxury Real Estate. “We are beginning to see a more normalized market where supply is more equal to demand. Even in the luxury market, there are fewer bidding situations.”

According to Redfin, the number of competitive offers fell from 45 percent to 32 percent in 2018. Still, some ZIP codes in busy markets such as Boston, Washington, D.C., and the Bay Area remain hotbeds of competition, with the number of multi-bid scenarios increasing in the third quarter.

© istockphoto.com/JZHUK

Concerns about potential bubbles continue to percolate, but economists and other experts caution that fundamentals are strong and for real estate the next downturn will be different. “The recent tax reform and increased government spending have been a shot in the arm of the U.S. economy,” Tim Wang, head of investment research at Clarion Partners, explained to journalists at the Urban Land Institute’s fall conference. Wang and other experts expect the current expansion of the economy to continue through 2019, tapering to 2.5 percent next year.  

“The housing market is following the trend in the overall economy, which needs to be noted because housing led the last downturn,” comments Marci Rossell, chief economist for Leading Real Estate Companies of the World, citing politics and global uncertainty as factors affecting real estate. This time, she says, “the casualties will be a little bit different, and because of that I don’t anticipate a meltdown.”

A cooling period is how Craig Hogan, vice president of luxury at Coldwell Banker Real Estate, characterizes the luxury climate, particularly in the second half of 2018. It’s a change Coldwell Banker has anticipated. “For any of us to think it was always going to be incredible is a little naive. The market is always going to fluctuate.” Hogan says it’s important not to interpret cooling as a market decline. “Cooling is a normal fluctuation, while a decline happens when the value of homes begins dipping.”

“There hasn’t been any great price suppression. Houses are staying on the market a little longer, but demand is still healthy,” says Losh.

“I think we’re still going to have a very strong year overall. I do believe we’re seeing price adjustments, and that’s okay. I think the key is watching how long properties are staying on the market and watching the size of the price adjustments,” observes Lesli Akers, president of Keller Williams Luxury International.

The average sales price for Sotheby’s transactions is up year over year. “From a luxury point of view, many of our companies are having a record year,” says Philip White, president and CEO of Sotheby’s International Realty. “Revenues are up, and in some cases pretty significantly,” he shares, noting that this number also reflects significant recruiting and/or acquisitions by some companies.

Recent stats show prices for upscale properties still increasing, but at a slower pace than past years. The number of sales in many places has dipped, but that differs by location, and in more than a few instances sales still exceed 2017.

Data from the Institute for Luxury Home Marketing (ILHM) shows median prices for single family luxury homes climbing 8.5 percent in November over October, while the number of sales fell 11.7 percent. For attached luxury properties, sales rose 2.6 percent with a 2.3 percent hike in prices.  

Putting the current market for real estate overall into perspective, Lawrence Yun, chief economist for the National Association of Realtors, said, “2017 was the best year for home sales in 10 years, and 2018 is only down 1.5 percent year to date. Statistically, it is a mild twinge in the data and a very mild adjustment compared to the long-term growth we’ve been experiencing over the past few years.” Yun and other housing economists are quick to point out that new construction still hasn’t caught up with demand and foreclosure levels are at historic lows, factors which make the current climate different than the run up to the recession. NAR’s forecast calls for an overall price increase of about 3 percent in 2019 while the number of sales flattens or edges up very slightly.

Tale of Two Markets

Luxury’s story is a little different. “This year the luxury market has been a tale of two markets, for sure. Some areas are struggling, but most have been stronger than many realize, particularly in the first half of the year. As median prices have been slowing (and getting lots of media attention), the top 5 percent of many major metro markets nationally have been growing, with sales over $1 million up over 5 percent year over year and prices breaking records, in some cases by double digits. In the majority of markets, inventory has been selling faster. This is happening simply because of the health of the affluent,” observes Anton.

What sets this year’s outlook apart is that some places are having a strong, dynamic market, while others are seeing a softening, often only in specific price brackets. “The slowdown that started on the East Coast is having some effect on the West Coast. But it’s not a typical slowdown,” says Mike Leipart, managing partner of new development at The Agency. “Good product that has relative value is continuing to transact.”

The top three sales nationally in the third quarter, each over $30 million, occurred in Laguna, and seven out of the top 10 were in Southern California.

Rather than a general market malaise, Leipart characterizes the slowdown as more of a spec home problem. “It’s just too much has been built too fast, and not all of it is very good. The people who thought they could build a house for $15 million and sell it for $30 million are struggling.”

The higher price points in L.A. may see an even stronger downturn in the near future, suggests Bob Hurtwitz, owner of Hurwitz James Company, who typically works in the very high end. “There is a lot of inventory on the higher end, and luxury home buyers are usually in a position to wait and see. The drops in price are a lot more dramatic on property at $15 million and above, and buyers are aware of the benefit in waiting to see how it plays out. At the ultra-high end of $100 million or more, you are going to see and already are seeing huge reductions in price.” What’s hot in L.A.? Luxury penthouses in full 24-hour security buildings in prime areas, according to Hurwitz. “High-end penthouses will continue to be in-demand from foreign buyers purchasing as a part time home or for housing for their children.” Other price brackets, notably the $1.5-million to $3.5-million range, are busy, and, Hurwitz says, his agents are doing a lot of deals.

Perceptions of prices in Manhattan can be skewed, since recent closings are often for new construction for which contracts (and prices) were written a couple of years prior. Even though stats show sales decreasing, Ellie Johnson, president of Berkshire Hathaway HomeServices New York Properties, says, “There is still a healthy but steady group of buyers that are still out there in the high-end luxury landscape.” Additionally, New York is particularly keyed to Wall Street, and volatility in the stock market often means more money gets transferred into brick and mortar. “We’ve seen an uptick that we didn’t have at the beginning of the fall season,” Johnson observes. Despite a less than stellar real estate market at year end, New York remains a global gateway and the top city for global wealth.

Manhattan

© istockphoto.com/CreativeImages1900

Los Angeles

© istockphoto.com/SeanPavonePhoto

St. Petersburg

© istockphoto.com/SeanPavonePhoto

In other locations, particularly those with lower prices for upscale properties compared to California, Florida or New York, reports show strong interest and price growth. An acre in one of Atlanta’s prime addresses in Buckhead can demand as much as $1 million. It’s just one indication that luxury here continues to reach new price levels with considerable demand coming from outside the region, including buyers from California and Florida. Some relocate simply because they want a home in the city; others follow corporate moves. The city has also become a favorite for the film industry, which has become a $4 million industry. “It’s changing everything about this city,” says Debra Johnston with Berkshire Hathaway HomeServices Georgia Properties. Luxury really doesn’t begin until the $5 million threshold, says Johnston, but prices compared to Florida and California are reasonable.

At one time, it was thought it might take more than 20 years for Florida real estate to recoup from the recession. In October, the state tracked 82 consecutive months of price hikes for both single-family and condo-townhouse properties, with many cities showing double-digit increases in the number of sales. “The overall market in Florida, particularly higher-end areas such as Sarasota, Naples and Palm Beach, is definitely strong and stable. Maybe not as robust as say 2013 and 2014, but we haven’t had any major slide — except the economists talking about the market slowing down,” says Pam Charron with Berkshire Hathaway HomeServices Florida Realty in Sarasota.

“The St. Petersburg market seems to be performing differently than other Florida markets and other national trends,” observes Tami Simms with Coastal Properties Group, noting November sales skyrocketed over the prior year. “We have developed into a year-round market with luxury downtown condominiums in high steady demand.” Another sign of consumer confidence is lack of defaults on pre-construction sales. “When we experienced the crash, those buildings that had been sold out prior to completion experienced a significant number of defaults. We see none of that in this instance.”

Florida is one of several states including Texas and Nevada benefiting from changes in tax law. Tax changes not only force some to reevaluate where they live, but they also impact the margins of price brackets. “While it doesn’t mean people wholesale leave New York or San Francisco, marginal changes tickle up and trickle down to the next closest price level,” and it will take several years for that to be felt, says Rossell.

The New Market

“So many trends have taken place they are no longer trends, they are the new market,” observes Hogan, using new construction as one example. “It doesn’t matter where you go or who you talk to, new construction is part of the conversation.”

Global demographics will have a long-term impact. “What luxury is adjusting to is a different demographic worldwide. Those aging baby boomers are kind of done with big homes and the following demographic is 50-percent smaller,” Rossell says.

Changing demographics affect location and property type. “I think we’ll see increased demand for primary residences in traditional second home and resort markets. We are seeing this trend in select markets, as individuals who have the freedom to work remotely are opting to live in places where they feel their quality of life will be the best,” observes Anthony Hitt, president and CEO, Engel & Völkers Americas.

Summer 2019 will mark the most prolonged economic recovery since World War II, but wild cards including interest rates, a trade war and further instability could easily derail this expectation. However, there is a silver lining to the current market. Increasing inventories will bring some buyers back to the market and create more demand. “I think it’s going to a be a great opportunity. People will buy things that they haven’t considered, and they’re going to buy more of them. I think that’s been a big challenge. We’ve not had the inventory, and a lot of buyers kind of just fell out of the market because they didn’t feel like there really was one,” explains Akers.

ILHM President Diane Hartley believes 2019 will be a year of opportunity for both buyers and sellers provided they remain agile, innovative and adaptable to their local market influence.

This story originally appeared in the Winter 2019 edition of Unique Homes Magazine. 

Click here to read the digital version.

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