According to a recent study, the wealthiest people in the United States prioritize a better lifestyle and sizable investment prospects when selecting their next home from the real estate markets.

According to the Douglas Elliman and Knight Frank Wealth Report, a quarter of ultra-high-net-worth Americans intend to purchase residential property this year. These properties are worth $30 million or more. 

On average, these individuals own four homes, with a quarter of their residential portfolio located outside their home country.

What Does the Wealthy Look For?

With their next significant investment, the ultra-wealthy prioritize “lifestyle” and “investment.” taxes and safety follow closely behind, according to recent findings.

Despite facing similar challenges like low supply and slow sales, luxury real estate fared slightly better than the overall market. Last year, 34 sales exceeded $50 million, a decrease from 45 in 2022 but significantly higher than in pre-pandemic years. 

Real estate experts suggest that interest rates are stabilizing and decreasing this year. However, there are initial indications of expanding the luxury supply, which could increase sales.

Liam Bailey, global head of research  and partner at Knight Frank, stated, “If we do see a pivot to lower rates, or at least more confidence that inflation is going in the right direction, I think you will begin to see inventory building up again.”

Report Predictions

The report predicts that Miami will be the top-performing luxury market in the U.S. this year for price growth. Moreover, experts expect a 4% price increase. New York follows closely in second place with a projected price growth of 2%. Meanwhile, Los Angeles looks at a 1% increase.

On a global scale, Auckland, New Zealand, leads the luxury real estate market with a projected price growth of 10% in 2024. Next, you have Mumbai, which follows closely in second place with 5.5%. Thirdly, you have Dubai, Madrid, and Sydney at 5%. Finally, you have Stockholm trailing at 4.5%.

In the previous year, the top 100 luxury real estate markets worldwide saw a commendable average price increase of 3%. Manila, Philippines, emerged as the top-performing market with a remarkable 26% growth.

Investors relocating from Hong Kong and China drove this growth. Dubai followed closely with a 16% price growth. Next, the Bahamas trail it at 15% and Portugal’s Algarve region at 12%.

New York was among the poorest performers last year, experiencing a 2% price decrease. Next is San Francisco, which remained nearly unchanged with a mere 0.5% increase. The most significant global decline among prime markets was observed in Oxford, U.K., with prices dropping by 8%.

The Richest Individuals Invest Abroad

Bailey noted that ultra-wealthy American buyers are expanding their investments abroad. He mentioned that U.S. buyers are now the primary foreign investors in ultra-prime properties in London. 

These people particularly eye those valued above $10 million. Additionally, they are showing increasing activity in European markets.

They’ve become quite a big presence, so much more noticeable now in Italy, France, and Portugal,” Bailey remarked. “I think the American buyers have become much happier to explore and kind of think about alternatives.

However, $1 million doesn’t stretch as far as it once did in the U.S. and internationally. In Monaco, the world’s priciest real estate market, $1 million buys only 172 square feet of prime property, per the Wealth Report. 

In Aspen, you get 215 square feet. You get 237 square feet in Hong Kong, making New York appear relatively affordable with 367 square feet.