Crypto, hybrid working will drive luxury housing boom in 2022
BNN Bloomberg
A new report from Sotheby’s International Realty predicts another strong year.
The only thing that can slow the global luxury market in 2022 is ... greed.
“It’s impossible to underprice a property in this environment,” says Bradley Nelson, chief marketing officer of Sotheby’s International Realty, which released its 2022 luxury outlook report on Monday.
A potent combination of sky-high bonuses, accelerating intergenerational transfers of wealth, low interest rates, and the specter of inflation “makes investing in a concrete, fixed asset like real estate attractive to many as they balance their portfolios,” Nelson says. The environment is such that, no matter how low a property is listed, demand and competition will push its price to the top of the market.
“We brokered a co-op sale in New York,” Nelson says. “The asking price was US$40 million, and there were multiple billionaires interested in purchasing it at the same time,” he continues. “The market is a living, breathing thing, and it’s going to give you feedback when fresh, desirable inventory comes on the market.”
Conversely, Nelson warns, aspirational pricing won’t be rewarded.
“It’s certainly possible to overprice a property,” he says, citing the Los Angeles market, where multiple houses have recently taken more than US$50 million price cuts before they sold. “But ultimately, with some of these ambitious asking prices, I think it’s a strategy of price discovery.”
