While the rest of the world sees a dip in the ultra-luxury home market, the playgrounds of the rich and richer — New York, Miami and Palm Beach — are cashing in like never before.
According to a new report from real estate firm Knight Frank, sales of homes priced at $10 million or more went through the roof in the second quarter — with Palm Beach leading the charge with a jaw-dropping 44% spike. Miami wasn’t far behind with a 27% bump and New York’s ritziest addresses enjoyed a 16% rise.
New York takes the crown as the reigning champ of high-end digs, boasting 72 sales over $10 million — its highest total in two years.
Miami followed suit with 55 big-ticket sales, while Palm Beach clinched 36.
Even Los Angeles made the top ranks with 42, although the city took a 29% hit — likely thanks to the new “mansion tax,” which slaps a 5.5% charge on properties selling for more than $10 million.
The most drool-worthy deal of the quarter? A whopping $150 million for Palm Beach’s only private island — scooped up by Australian infrastructure magnate Michael Dorrell. Palm Beach wasn’t done there; in June, a historic 3.2-acre estate went for a cool $148 million.
Not to be outdone, Manhattan joined the mega-sale club in July with the penthouse at the Aman New York changing hands for $135 million. The project’s developer, Vlad Doronin, purchased it for himself.
Even as demand cools in other top-tier markets, ultra-wealthy buyers are still willing to shell out record prices for these rare gems. Why? “Substantial wealth creation has supported the growth in the global super-prime sales market,” Liam Bailey, global head of research at Knight Frank, told CNBC.
He added that the transformation of hotspots like Dubai, Palm Beach and Miami “has more than offset the slowing experienced by some more mature markets.”
Globally, though, things aren’t quite as rosy.
Knight Frank’s report shows that sales of $10 million-plus homes in the top 11 luxury markets dipped 4% over the past year to $8.5 billion.
Dubai has become the world’s new darling of high-priced real estate, boasting a staggering 85 sales in the second quarter alone. The city’s friendly tax and regulatory policies have attracted the ultra-rich from around the world, transforming it from a mere 23 sales in 2019 to 436 over the past year.
London, on the other hand, isn’t faring so well. Sales of $10 million-plus homes there have plunged by a staggering 47%, as the specter of higher taxes has the wealthy thinking twice.
The good news for high-end property brokers: Even though most of these cash-flush buyers aren’t borrowing to buy, falling interest rates worldwide could bolster sales in the coming months.
And if last week’s record 29 contracts signed for $4 million-plus properties in Manhattan is any sign, the luxury market could be poised for a hot end to the year.
“With rates moving lower, total transaction volumes are likely to tick higher into 2025,” Bailey told the outlet.