Luxury real estate in the world: sales of homes above 10 million decline

Rising interest rates have impacted all levels of the global real estate market, and the luxury housing segment is no exception. In the second quarter of 2023, there were 422 residential sales over $10 million in 12 cities analyzed in the Knight Frank Global Super-Prime Intelligence Report. This number is 11% lower than the 475 sales recorded in the first quarter of this year and 13% lower than the 483 made in the second quarter of 2022.

Nevertheless, there were 1,638 global sales between June 2022 and June 2023, well above the values seen before the pandemic (1,009 in 2019). The Knight Frank report analyzed the cities of Dubai, Geneva, Hong Kong, London, Los Angeles, Miami, New York, Orange County, Palm Beach, Paris, Singapore and Sydney.

Despite the year-over-year decline in global sales, four markets showed sales growth, led by Dubai (up 79% between Q2 2022 and Q2 2023), Sydney (up 46%), Paris (up 17%) and Geneva (up 7%). The largest year-over-year decline was seen in the major U.S.

"Global premium real estate sales are down from recent highs but continue to exceed pre-pandemic levels. Dubai continues to lead the way, but London and New York continue to show healthy sales volumes. The main constraint in most markets in the near term is supply - the dearth of new projects launched between 2020 and 2022 indicates that 2024 will be thin on new supply and will lead to increased competition for affordable availability," commented Liam Bailey, global head of research at Knight Frank, quoted in the press release.

Portugal: a growing niche real estate market

Although no region in Portugal is on the list, the market known as super-premium, which includes property sales over €10 million, continues to experience increasing demand. Francisco Quintela of Quintela + Penalva, Knight Frank's partner in Portugal since 2021, explains why.

"The market with tickets above 10 million is considered a niche market in Portugal, but with a constant and increasingly precise demand, particularly for exceptional or collectible properties, as we call them, and in areas such as Comporta and Quinta do Lago, as well as in Lisbon, where Quinta da Marinha is a great example of consolidation and interest from international clients," he says.