Weekend Argus (Saturday Edition)
International sales of top luxury homes are on the up
AFTER a year of tepid growth in 2016, sales of international luxury homes bounced back last year, posting the best annual growth rate in three years at 11%.
Rising consumer confidence, low interest rates, a robust stock market and a stable global economy drove demand for luxury property last year, continuing into this year, despite localised pockets of uncertainty that gave some buyers reason to pause.
This is according to Luxury Defined, the annual analysis of global luxury residential housing dynamics by Christie’s International Real Estate.
Worldwide sales of $1 mil- lion-plus (about R13.6m) homes in primary housing markets were up 10% year on year, the strongest annual gains in this luxury housing cohort recorded in the previous three, Luxury Defined reports.
Sales volumes of second homes and resort lifestyle destinations grew by 19%, up from a 7% annual decline in the previous year.
Tech hubs posted gains, as did hidden luxury enclaves and reinvigorated cities.
“There are a number of tailwinds for the luxury residential real estate markets, including buoyant equity markets and a relatively stable global economy.
“Factors that dampen investor enthusiasm in other asset classes, such as equity market volatility – the first quarter volatility index recorded its highest quarterly average since 2007 – support a flight to the safety of real assets,” says Dan Conn, chief executive of Christie’s.
“Political uncertainty has also led investors to diversify into this less volatile asset class.”
Now in its sixth year, the study synthesises data from more than 80 brokerages worldwide, including Greeff Properties, compiling observations of luxury drivers from on-theground experts to insights from Christie’s executives.
Mike Greeff, chief executive of Greeff Christie’s, says: “The luxury property mar- ket, as defined by Christie’s International Real Estate, are properties priced from $1m and upward.
“PropStats shows sales in the luxury market in the southern suburbs and Atlantic seaboard dropped 60% year on year from January to June 2017 to the same period this year.
“However, we are noticing the average listing days for properties at this level are decreasing from just over four months on the market to just over three months.
“We are also seeing a narrowing of the gap between asking and selling prices of properties from 8.5% down to 6.6%, which shows sellers are more realistic in the pricing of their homes.”