The sales of ultra-luxury homes have experienced a significant surge in certain U.S. markets, such as New York, Miami, and Palm Beach, Florida, during the second quarter of the year. According to a recent report by real estate firm Knight Frank, the number of homes sold for $10 million or more increased by 44% in Palm Beach, 27% in Miami, and 16% in New York. This trend highlights a growing demand for high-end properties in these specific locations, despite a decline in many other parts of the world.
Among the noteworthy sales in these markets, Palm Beach’s $150 million deal for the only private island in May stands out, reportedly purchased by Australian infrastructure investor Michael Dorrell. Additionally, a historic 3.2-acre estate in Palm Beach was sold for $148 million in June, while Manhattan’s Aman New York penthouse fetched $135 million in July. These high-value transactions underscore the willingness of ultra-wealthy buyers to pay record prices for rare trophy properties, driven by increasing financial markets.
While demand in many top luxury markets is showing signs of slowing down from the peak seen in 2021, ultra-rich buyers around the world are continuing to invest in ultra-luxury properties. According to Knight Frank, markets like Dubai, Palm Beach, and Miami have experienced significant growth, offsetting declines in more mature markets. Globally, sales of $10 million-plus homes in the 11 key luxury markets tracked by Knight Frank dropped by 4% compared to the previous year, totaling $8.5 billion in sales.
Dubai stands out as a global leader in ultra-luxury real estate, attracting wealthy individuals from Russia, China, Europe, and other regions due to favorable tax and regulatory environments. Despite a slight drop in sales in the second quarter, Dubai has witnessed a remarkable increase in ultra-luxury transactions in recent years. Conversely, London experienced one of the largest declines in ultra-luxury home sales, dropping by 47% year-over-year, primarily due to concerns about higher taxes on the wealthy in the U.K.
While ultra-luxury buyers typically pay in cash for their properties, the overall decline in interest rates worldwide is expected to support sales in the latter half of the year. Knight Frank suggests that lower rates could lead to increased transaction volumes through 2025, providing a positive outlook for the ultra-luxury real estate market in the near future.