The sale of luxury real estate is fueled by cash-rich millennials and the tech economy of Silicon Valley.

 

One 57, Manhattan

Like all real estate markets across the world, luxury real estate in the US has been in a rather depressed state over the past two years. However, like the rest of the world, the market is showing some sign of revival. In fact, one can even say that it has shown an impressive upswing over the last year.

Some really enormous deals have been made over the past few days. Among them is a $18.95 million deal by a Brooklyn investor, who bought a 1911 nine-story elevator building in Manhattan with 29 apartments — one one-bedroom, 10 two-bedrooms and 18 three-bedrooms, just recently. The opening months of 2018, in fact, has seen the sale of luxury condos pick up quite a bit, as reported by CityRealty.com. The price of a luxury condo can range from $2000 to $3000 per square feet, and an average price of a condo can be about $7.5 million. In February, this year, at least 62 luxury condo sale contracts were signed.

Sunset Strip, LA

Among the neighborhoods that have seen brisk sale of luxury housing is Carnegie Hill, the Upper East Side area, which is comprised of diverse housing stock. Prices for a townhouse here, or an apartment, can go up to $29.5 million, claimed Stacey Froelich of Compass Real Estate, in his report on Carnegie Hill.

Luxury real estate is seeing good sales not just in Manhattan. Last month, Luxury Portfolio International released a report called “The Rise of the New Aristocracy,”  It looks at how millennials, or people between 25 and 49, are driving the luxury market, and their biggest investment is in real estate. The Luxury Portfolio International report observes that 54 percent of these buyers are looking for urban living and are paying top dollars for the right address.

Some of their favored destinations include the Sunset Strip in Los Angeles, and the ‘Bird Streets’ north of it. The ‘Strip lifestyle’, with all its cafes, restaurants and bars, combined with the peace and quiet of the neighborhood, is much desired. The report also indicates that High Net Worth buyers are in search of large lots of land, from Bel-Air to the San Fernando Valley, to build stand-alone villas.

Silicon Valley Real estate

Even the Silicon Valley has witnessed a quickening of luxury real estate properties, with high-end homes in Santa Clara county seeing a rather large upward swing in sales and prices, amounting to almost a 32 per cent over last year. The county has seen several sales of homes priced at $2 million or higher.  In January, this year, a beautiful 10,000 square feet five-bedroom villa in Saratoga sold for $10.5 million.

Silicon Valley Luxury Real Estate

Realtor.com, which tracks sales of high-end homes in the US, put the San Jose region – which includes Silicon Valley towns such as Palo Alto and Cupertino – on top of the pile as far as prices and sales go. The median home value in these regions has soared 21 per cent earlier this year, to US$1.17 million. As more and more start-up owners sell their companies, and ideas, to big investors, or go public, the cash-rich tech economy will produce more millionaires, resulting in higher growth in luxury property.

This is a very good time to be a luxury real estate seller in the US market.