Relocation Reboot

Dissatisfied buyers may now find more opportunity in the real estate market if they do decide to sell. Over two-thirds of survey respondents stated current market conditions, such as less competition and prices leveling out, may have changed their minds about buying in the near future. They may also be able to sell their current home for more than what they bought it for, although it might take longer to sell. Some discontented affluent buyers may ultimately decide not to sell their home, instead folding it into their real estate portfolio and simply moving to another location.

Nearly 41% of respondents anticipated that their next purchase would be based on investment opportunity. Interestingly, the locations they are most eyeing are in New York and California – two states that experienced a “wealth migration” of high-net-worth earners during the pandemic as they fled to lower tax locales such as Texas, Florida, and Arizona during the pandemic.¹

Among their reasons for choosing these locations? About 40% said that quality of life remained at the top of their priority list. This underscores the long-term cachet and strength of these two historic wealth epicenters.

Puttin G It In Pe R Spective

DIANE HARTLEY, President, Institute for Luxury Home Marketing

It is important to note that a large majority – close to 72% – of respondents reported being satisfied with their home purchase during 2020 and 2021. However, with the insatiable buying frenzy and quick decisions being made, there were bound to be stories of regretful buyers who leaped too quickly into unknown environs.

These buyers may end up staying in place and renovating, or they may be encouraged by rising inventory levels in their local marketplace this year and relist their current home for a profit. Others, if they have the financial means, may simply choose to keep the home as part of their investment portfolio, convert it to a rental and make a lateral move to a different, more affordable market. What these buyers decide to do will most likely depend on not just personal factors, but local factors too. The varied nature of the current luxury real estate landscape makes it challenging to predict how their regrets could eventually manifest in the market.