An Investment Proven To Hold Its Value

Prone to behaving cautiously, the affluent have begun to signal that they are looking for more stable long-term investments to protect their wealth and give them peace of mind. Real estate has always been one of Americans’ favorite long-term wealth-building assets –and it shows in our survey.

Over a third of survey respondents believe real estate to be the safest long-term investment, ranking it higher than company shares, stocks and bonds, cryptocurrency, and pensions. And they are willing to put their money where their belief is because over 75% of them own at least one investment property.

LONG-TERM

Real estate generally offers reliability and stability for those investors who are able to play the long game: hold onto their asset when the market trends down and wait until prices start to rise again.

Source: Institute for Luxury Home Marketing

Low Inventory Meets Price Stability

Even though inventory is beginning to rise across many luxury markets this year, the increases are not expected to be enough to bring prices down significantly any time soon. Inventory levels in the U.S. are still below 10-year averages¹ reported prior to the start of the pandemic – and not likely enough to relieve the massive housing shortage. Land also remains scarce.

With home ownership so central to the American mythos and interest in owning property by newly minted millionaires so high, it is not likely that supply will meet demand in the near future in the luxury sector. The nation needs an estimated 5.8 million additional homes to meet demand, according to Realtor.com.²

Even if demand eventually plateaus next year, property prices are not likely to drop significantly.