North America Luxury Residential Real Estate Market- Growth, Trends, Covid-19 Impact, And Forecasts (2022 - 2027)

The market is segmented By Type (Villas and Landed Houses, Apartments, and Condominiums). The report offers the market size and forecasts in value (USD billion) for all the above segments.

Market Snapshot

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Study Period: 2018-2027
Base Year: 2021
CAGR: >2 %

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Market Overview

The North American Luxury Residential Real Estate Market is expected to register a CAGR of more than 2% during the forecast period.

Due to limitations, social distancing measures, and the work-from-home lifestyle, the COVID-19 epidemic significantly impacted the North American residential real estate market. At the beginning of 2020, the median sale price of a home in the U.S. was USD 288,000, and by the beginning of 2021, that figure had increased by 14% to USD 329,000. At the start of 2022, the median home price had jumped another 16% to USD 376,000—and was already up to USD 424,000 as of April of this year.

The COVID-19 epidemic has tremendously influenced consumer choices for what they want in a residential home. As a result, individuals are increasingly choosing lavish mansions and vacation homes in outlying locations since they provide more open space and beautiful green surroundings. People have realized the significance of family and well-being. While many big cities saw citizens migrate once Covid-19 lockdowns began, other cities experienced increased high-end property sales and prices. The most expensive listing in Florida in 2021 was 25,754 percent more than the median price.

Scope of the Report

Luxury residential real estate has a premium location, a high price, a huge size, precious materials, professional design, high-end facilities, and historic history. Buyers wishing to acquire a luxury home can pay anywhere from a few million dollars to more than USD 100 million, depending on local property prices. Today, a home is not considered luxury simply because it is expensive or large. Upgraded features like an expansive floor plan, a fully stocked kitchen, and a spacious pool are what luxury home buyers are after now.

The market is segmented By Type (Villas and Landed Houses, Apartments, and Condominiums). The report offers the market size and forecasts in value (USD billion) for all the above segments. The report also covers the impact of COVID-19 on the market.

By Type
Villas and Landed Houses
Apartments and Condominiums
Geography
United States
Mexico
Canada

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Key Market Trends

Emergence of the Millennial Generation in USA

The majority of wealthy millennials are in their thirties. Because many of them can now work from home, their desire to establish a family, combined with the option to relocate to a lower density location, not to mention receiving a low-interest mortgage, creates a perfect storm in favor of buying rather than renting. Approximately 81 percent of Americans aged 23 to 31 who bought a home were first-home buyers, whereas only 48 percent of home buyers between 32 and 41 bought their first home in 2021.

However, millennials are now recognized as one of the real estate's most significant customer groups. According to the National Association of Realtors, 38 percent of millennials currently own houses in the United States. According to Sotheby's International Realty Statistics, millennials bypass modest residences in favor of larger, more luxurious ones.

The epidemic forced them to stay indoors for unusually long periods and reconsider their homestay alternatives. They now want to acquire large homes that accommodate their family's various demands, including the home office. It also shifted their priorities, with many preferring to invest in luxurious houses rather than go to exotic locations. Of course, some market considerations have also played a role.

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Constant Residential Real Estate Investments

Despite the growing economic instability and the potential of a third COVID-19 wave, High Net-Worth Individuals (HNIs) continue to invest in luxury real estate. However, many people's motivations for investing in these homes have shifted. For example, many people are now motivated by the desire to improve their health and living standards.

Even after eight years of steady home price increase, the great housing boom in the United States continues undisturbed. It has benefited from low-interest rates and the government's large stimulus programs designed to minimize the epidemic's effects. The market's limited supply of houses has resulted in rising real estate prices.

According to Standard and Poor's, house prices continue to grow rapidly in all of the country's 20 main cities, with Phoenix reporting the biggest year-on-year increase of 32.41 percent in July 2021, followed by San Diego (27.79 percent) and Seattle (27.79 percent) (25.5 percent ).

While individuals prefer connectivity, open spaces within and outside living places are vital to people, particularly after COVID-19, to preserve their physical and mental well-being. The health advantages of living in big homes surrounded by nature and a pleasant atmosphere attract purchasers to invest in luxury residences.

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Competitive Landscape

The study focused on the leading stakeholders in the Luxury Residential Real Estate Sector. North America's residential real estate industry is fairly fragmented, with the top organizations responsible for about 30-40% of the market share. There are many developers, and the market is highly competitive. Large firms have financial resources, but small businesses can stay competitive by establishing expertise in local markets.

D. R. Horton Home construction, Lennar Corporation, PulteGroup, Mill Creek Residential, and Wood Partners are among the key players.

Recent Development

June 2022: Three major homebuilders have paid USD 111.7 million for an 836-acre plot of unoccupied property in the West Valley, which will house up to 2,800 people. The property, located on the northwest corner of 163rd Avenue and Happy Valley Road in Surprise, is directly northeast of Lennar's current Asante master-planned community, which comprises 3,500 acres and will ultimately house more than 14,000 houses. Asante has so far seen the construction of around 1,500 residences.

July 2021: Mighty Buildings, located in Oakland, has secured a USD 22 million extension to its Series B investment round. The company is on a mission to create homes using 3D printing, robots, and automation. The fresh fundraising follows a USD 40 million round announced earlier this year, bringing the company's total funding since its founding in 2017 to USD 100 million. Mighty Building's self-proclaimed objective is to build beautiful, sustainable, and cheap homes. The micro-factories, according to the company, will be able to produce 200 to 300 homes per year in locations where housing gaps exist.

Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Deliverables

    2. 1.2 Study Assumptions

    3. 1.3 Scope of the Study

  2. 2. RESEARCH METHODOLOGY

  3. 3. EXECUTIVE SUMMARY

  4. 4. MARKET DYNAMICS

    1. 4.1 Market Overview

    2. 4.2 Market Drivers

    3. 4.3 Market Restraints

    4. 4.4 Value Chain / Supply Chain Analysis

    5. 4.5 Porter's Five Forces Analysis

      1. 4.5.1 Threat of New Entrants

      2. 4.5.2 Bargaining Power of Buyers/Consumers

      3. 4.5.3 Bargaining Power of Suppliers

      4. 4.5.4 Threat of Substitute Products

      5. 4.5.5 Intensity of Competitive Rivalry

  5. 5. MARKET SEGMENTATION

    1. 5.1 By Type

      1. 5.1.1 Villas and Landed Houses

      2. 5.1.2 Apartments and Condominiums

    2. 5.2 Geography

      1. 5.2.1 United States

      2. 5.2.2 Mexico

      3. 5.2.3 Canada

  6. 6. COMPETITIVE LANDSCAPE

    1. 6.1 Market Concentration Overview

    2. 6.2 Company Profiles

      1. 6.2.1 D. R. Horton Home Construction

      2. 6.2.2 Lennar Corporation

      3. 6.2.3 PulteGroup

      4. 6.2.4 Mill Creek Residential

      5. 6.2.5 Wood Partners

      6. 6.2.6 Alliance Residential

      7. 6.2.7 LMC Residential

      8. 6.2.8 The Michaels Organization

      9. 6.2.9 Century Communities

      10. 6.2.10 Toll Brothers Building Company*

    3. *List Not Exhaustive
  7. 7. MARKET OPPORTUNITIES AND FUTURE TRENDS

  8. 8. APPENDIX

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Frequently Asked Questions

The North America Luxury Residential Real Estate Market market is studied from 2018 - 2027.

The North America Luxury Residential Real Estate Market is growing at a CAGR of >2% over the next 5 years.

D. R. Horton Home construction, Lennar Corporation, PulteGroup, Mill Creek Residential, Wood Partners are the major companies operating in North America Luxury Residential Real Estate Market.

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