Sotheby’s International Realty released its 2026 Luxury Outlook® report, analyzing the evolving state of global luxury real estate markets and the economic policies and factors that influence them most. The latest edition offers insights into the trends and developments shaping the sector. After outperforming traditional real estate in both sales and value in 2025, the luxury market is expected to continue its upward trajectory in 2026. Key findings include the US$6 trillion inherited in 2025, a transfer of generational wealth that is becoming a major demand driver for luxury real estate, a 44% surge in foreign buyer activity in the U.S., and the threshold for a luxury home in the U.S. is rising, with national expectations starting at around $1.3 million; higher than in many other countries.
“Sotheby’s International Realty’s Luxury Outlook Report draws upon the knowledge of leading luxury experts and the data from respected financial institutions like JP Morgan and UBS,” said Richard Taylor of Gulf to Bay Sotheby’s International Realty. “When combined, the report highlights market successes, trends and concerns of today’s luxury buyer in both big cities and resort markets.”
The 2026 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 JPMorgan Private Bank, PricewaterhouseCoopers, Cerulli Associates, Henley & Partners, UBS, and the National Association of Realtors (NAR).
Key takeaways in the report include:
- Luxury real estate continues to outperform the general housing market, driven by sustained wealth creation and less sensitivity to macroeconomic factors.
- Generational wealth transfers reached $6 trillion in 2025, 10% of global GDP and will continue fuelling luxury demand.
- To respond to the changing market conditions, both home buyers and sellers should consider “first mover advantage” as acting decisively benefits them – early movers often secure better deals or faster sales.
- Inventory levels of new construction homes have returned to pre-pandemic norms, creating a healthier and more balanced market. U.S. supply of homes priced $1M is at its highest since 2020.
- Crypto is increasing influencing luxury purchases, especially in markets like Dubai, New York and California. Regulatory changes may allow crypto assets to count toward mortgage qualification.
- 60% of affiliated agents have reported that lifestyle factors and integration of wellness amenities, ski/golf communities as more important than ever in influencing buyer decisions.
- There is significant cross-border demand, the foreign buyer activity surged 44% in the U.S. with Florida, California, Texas and New York as leading destinations.
- 81% of affiliated agents cite security as a top concern; features like gated access, CCTV, backup power and even panic rooms have become increasingly common.
- Growing demand for homes that accommodate multiple generations driven by legacy planning and lifestyle.
- Major tournaments (e.g. 2026 FIFA World Cup, 2028 LA Olympics) can boost property values near host cities, but long-term gains can depend on urban planning.
- The appeal for branded residences continues to grow as high-service, low maintenance living is expanding globally.
Click here to read the complete report.