The latest edition of the Sotheby's International Realty report provides insights into trends and developments that affect the global luxury real estate market. Outperforming traditional real estate in 2025, both in sales and increased value, we expect luxury real estate to continue that trajectory in 2026.
The report also reveals there are effectively two real estate markets—the luxury market and the general market—which perform differently. The resilience of the luxury real estate market reflects a premium economic foundation that provides greater stability against volatility.
Research also demonstrates that luxury property buyers are less constrained by geography and macroeconomic factors than other homebuyers. Sustained wealth creation through real estate and equity investments continues to be a key driver of global luxury markets. Some good news from 2025 that bodes well for the luxury real estate market in 2026 is that inventory levels have rebounded to where they were pre-pandemic. A balanced real estate market is healthier and more sustainable, with more options for homebuyers.
To respond to changing market conditions, both home sellers and homebuyers should consider the “first mover advantage”—being the first to act decisively when opportunities arise or shift. This is often seen in development projects that are the first to adjust their pricing. These projects often gain momentum and attract more offers, which snowballs into the development becoming the hottest in the market.
For home sellers, that means pricing realistically rather than opportunistically and considering the potential negative impact of carrying costs if they decide to wait a year or two to sell. For homebuyers, the "first mover advantage" can mean acting quickly when a once-in-a-generation opportunity arises.
We’re also seeing a meaningful shift toward multigenerational living among wealthy households. This trend is about more than a lifestyle—although clearly one major goal is spending time with loved ones. It is also about long-term estate planning and legacy building, a way homeowners can transfer some of their wealth during their lifetime by building or buying a home for their heirs.
The global perspective of the Sotheby’s International Realty brand’s network provides unique insight into these evolving trends and shifting priorities. This worldwide reach enables homebuyers to make informed decisions—wherever their search takes them.