Fifth Installment of Report Reveals Insights on the US$84 Trillion Intergenerational Wealth Transfer, Elite Market Shifts, and High-Net-Worth Individual Migration Patterns
Today, Sotheby’s International Realty released its 2025 Luxury Outlook℠ report, which delves into emerging trends and key developments set to shape the global luxury real estate landscape in the coming year. The report highlights significant factors, including how a US$84 trillion intergenerational wealth transfer may affect the real estate market, where 135,000 high-net-worth individuals (HNWIs) are projected to relocate, and the profound impact of "Best Places to Live" rankings on a city’s property values and inventory levels.
Key takeaways in the report include:
- The economy has largely normalized following the volatility of the pandemic years, which has led to adjustments in the property market. Overall, home sales volume in the U.S. in 2024 was a little behind 2023, but the upper brackets performed better than the average priced market.
- On January 7, 2025, devastating wildfires swept through Los Angeles County, California, destroying thousands of homes and businesses. J.P. Morgan economist Abiel Reinhart has predicted they may be the costliest climate disaster in U.S. history, which stems both from their size and the high value of the residential real estate they are destroying.
- The great wealth migration hit record levels in 2024 as an estimated 128,000 HNWIs migrated to new countries.
- By 2045, as much as US$84 trillion will have flowed from the Silent Generation and Baby Boomers into the bank accounts of their children and grandchildren. In response, the luxury market is changing to reflect the tastes and preferences of younger generations.
- Women are coming into their own as independent homebuyers. Women’s presence in the high-end housing market is set to increase. Women are expected to be in charge of US$34 trillion, or about 38% of all investable assets in the U.S. by 2030. Data from a March 2024 report from the Bank of America Institute indicates that the coming intergenerational wealth transfer “will contribute to women controlling more wealth than ever before.”
- Year after year, several cities consistently rank among the best places to live in the world. These lists can have genuine impacts on the cities they champion.
- Branded residences have existed for several decades, but the trend notably picked up during 2020, according to global architecture firm WATG. Since then, the firm has tracked 84 new projects that have opened around the world. As of 2024, the global branded residential market is valued at US$66 billion.
- Buyers continue to seek homes that align with their personal aspirations and values. Trends such as hybrid working, heightened demand for wellness amenities, and sustainability are shaping the luxury housing market and influencing buyers’ decisions.
The 2025 Luxury Outlook report draws on insights from Sotheby’s International Realty agents worldwide who specialize in transactions in the US$10M+ price category. Their expertise is complemented by data from industry leaders including J.P. Morgan Private Bank, PricewaterhouseCoopers, Cerulli Associates, Henley & Partners, UBS, and the National Association of Realtors (NAR).