Why high-end buyers are still spending big on luxury real estate

July is Luxury Month at Inman. We’ll take the temperature of the luxury market, talk to top producers in the ultra-luxury space and dive into the luxe trends of today — all culminating at Luxury Connect in San Diego, where we’ll announce this year’s Golden I Club honorees.

Market data and anecdotal evidence from luxury experts thus far this year has shown the high-end sector of the real estate market is holding steady, even as other areas of the market falter.

But which trends, exactly, are driving the luxury market in the face of adverse economic conditions?

Among other things, experts who spoke with Inman said luxury buyers favor strategic investments, are looking at real estate as a relative safe haven, and tend to prefer cash transactions right now. But the key, the experts said, is that higher-end buyers are still very eager to invest at this particular moment.

‘Smart’ behavior

In response to shifting market conditions, luxury buyers are transitioning into a more conscientious mindset in which a real estate purchase is less about “indulgence” and more about strategy, Coldwell Banker Global Luxury Vice President Michael Altneu said. This is one of the primary buyer behaviors the company sees driving the market today.

“We’re seeing a market that isn’t fully bullish or bearish — but rather, recalibrating,” Altneu said in an email. “Buyers are discerning and sellers are adjusting and navigating an environment where practical considerations such as home affordability, tax strategy, estate planning, property utility and long-term investment potential are now taking priority over softer lifestyle drivers, such as aesthetics, flashy amenities or location cachet.”

In other words, luxury clients are seeking to create value in their investment, sometimes by buying what they perceive as a bargain that needs work. At the opposite end of the spectrum, some may see purchasing a turnkey property as the smarter buy today, since it avoids the somewhat more volatile and unpredictable construction costs, which are currently up in the air because of shifting tariff policies.

“We’re seeing a clear trend where fully remodeled or new construction homes built within the last three years are demanding a significant premium,” Chris Morrison, founding partner at RETSY | Forbes Global Properties, told Inman in an email. “Buyers are willing to pay top-dollar for something that’s turnkey and move-in ready.

“On the flip side, if a home is even slightly dated or only partially remodeled, it often trades just above base land value. That’s opening up some opportunities for buyers who are willing to take on a remodel and ride out the process.”

Seeking safe investments in real estate

In many major markets across the U.S., transactions priced at $10 million and up have skyrocketed since February, according to a Wall Street Journal analysis.

Florida’s luxury enclave of Palm Beach saw $10 million-plus home sales rise 50 percent between Feb. 1 to May 1, 2025, compared to the same period in 2024. Meanwhile, the luxury mountain town of Aspen, Colorado, saw such sales increase by 43.75 percent year over year. In LA, $10 million-plus sales jumped 29 percent on an annual basis, and in New York City, they increased by 21 percent year over year.

Meanwhile, in Arizona, where RETSY operates, Morrison said the appetite for luxury real estate has remained unusually strong.

“Typically, during the summer, we see a slowdown in the upper price ranges as many buyers travel or leave town,” Morrison said. “This year has been a noticeable shift. Sales have hit record highs in RETSY, and we haven’t seen the usual absence of high-end buyers.”

High-net-worth clients tend to view economic uncertainty as an opportunity, Cotality Chief Economist Selma Hepp said in Sotheby’s International Realty’s 2025 Mid-Year report. And some incoming policy changes by the Trump administration stand to benefit the affluent.

“Many of the policy changes promised by the new administration in the U.S. — such as tax cuts — are advantageous to [high-net-worth individuals or HNWIs],” Hepp said in Sotheby’s International Realty’s report. “In addition, wealthier households have more resources and are less concerned about inflation and unemployment. No one is immune to uncertainty, but it’s less of a concern for high-net-worth individuals because they have investments.”

Favoring cash

Cash investments are another trend that has become even stronger in this market while high-net-worth individuals seek to avoid paying mortgage interest. Cash purchases are, of course, nothing new for luxury buyers, but they seem to have surged in the current environment, luxury experts say.

Nearly 90 percent of agents surveyed in the 2025 Mid-Year Sotheby’s International Realty report said that the top transaction method on luxury properties was via cash.

Coldwell Banker Global Luxury’s 2025 mid-year report likewise said that 96 percent of luxury property specialists were witnessing at least a steady or growing number of all-cash purchases. Nearly 70 percent of Coldwell Banker luxury property specialists said their clients were holding steady or growing their real estate investments.

Some of those cash purchases are also coming into play with parents helping their children buy their first property, Morrison said.

“We’re seeing a growing trend of family money subsidizing purchases, parents helping with large down payments or buying in cash altogether, with plans for the buyer to refinance out later if and when rates drop.”

International money coming in

As the value of the U.S. dollar falls in relation to other international currencies because of trade wars and related factors, some international buyers are latching onto the opportunity to invest while they can get more for their money.

In the first quarter of 2025, international online traffic to Realtor.com was 1.9 percent, up from 1.7 percent the previous quarter, and up from 1.3 percent during Q1 2020.

Miami was the most popular market for potential foreign home-seekers, with 8.7 percent of international online views directed to the South Florida market.

During the first half of 2025, interest in U.S. real estate by Russian nationals increase 78.5 percent year over year, according to data from real estate firm Tranio, RBC News reported. That made the U.S. the ninth most desired destination for Russian real estate investment by the end of June.

Jade Mills, a Coldwell Banker Global Luxury Ambassador, who sometimes works with international clients, told Inman recently that some of her clients are becoming newly interested in the U.S.

“I’m not saying that there are a lot of those people, but there are some, and we’re seeing them start to look and buy here again, which is great.”

More of those international real estate investments may be on the horizon if President Trump’s proposed “Gold Card” visa program, which creates a path to citizenship for individuals who invest $5 million in the U.S., does not face significant obstacles. The program has received about 70,000 applicants, Commerce Secretary Howard Lutnick told the Financial Times, which has the potential to translate into substantial investment in the U.S. luxury real estate market, since many of those investments may be made in real estate.

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Email Lillian Dickerson