The world of luxury spans far beyond just expensive homes. One cannot mention lux life without mentioning the travel destinations, clothing and jewelry brands, cars and more that affluent consumers around the world love. The wealthiest 10% of Americans added more than $8 trillion to their net worth since the start of the health crisis which left them plenty of room to buy as much as their heart desired. After consumers started to make their way outside, many were ready to travel, dine out, spend more on luxury goods and new homes. This speaks to how strong the luxury world, whether it be goods or housing, truly is.
Chanel, Hermes and LV…Oh My!
In the year that the world has been recovering, it is reported that consumers saved more than $2.5 trillion in spending, leaving the affluent more room to buy when vaccines became available when the outside world started to open. Consumers started to treat themselves again with the most sought-after brands during the pandemic being Chanel, Hermes and Louis Vuitton. By the first quarter of 2021, luxury French brand LVMH Moet Hennessy Louis Vuitton had already experienced a resurgence of growth with almost $17 billion in sales across 70 countries. Fashion brands, particularly leather brands, fared better than other luxury goods by the start of 2021 generating almost $7 billion in sales, 37% higher than 2019 figures. Looking ahead, luxury brand goods are projected to recover to pre-pandemic levels by 2022 or 2023 according to Bain & Company. By the looks of things, these brands truly have staying power.
What about Luxury Homes?
Many sectors of the economy experienced serious declines over the course of the past year, but much like how the world of luxury goods recovered, the luxury real estate market was able to stay on a consistent and successful trajectory. From the start of the economic shutdown in March 2020 through the end of the year, the average sold price of homes priced above $1 million was $1,516,000 in metro Atlanta and still averaged more than one thousand homes for sale per month. According to an analysis by Point2 Homes, the number of homes sold for more than $1 million in the U.S. was up 81% overall, while sales in the southern United States were up a whopping 94% (February 2020 to February 2021). Luxury Portfolio International states that in North America, there are nearly 3 million luxury buyers in the market looking to purchase in the next 3 years. Confidence in the market has been returning as more than one in three affluent consumers say they think the luxury real estate market is getting stronger. Furthermore, Luxury Portfolio International reports that more than 10 million consumers worldwide are seeking homes valued at $1 million or more.
Much like the state of luxury brands, luxury real estate sustained profits, demand and interest despite the challenges they both faced over the course of the last 18 months. And with that, the luxury market will continue to persevere regardless of hard times. Harry Norman, REALTORS® specializes in luxury with knowledgeable REALTORS® equipped with staff that can help you maximize the sale of your luxury home or find the home you’ve always wanted. Contact a Harry Norman, REALTOR® today so you can soon live in your own lap of luxury!
