Tarpon Island, a private island in Palm Beach, Florida, was sold for $150 million in May 2024.
CNBC
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Sales of ultra-luxury homes surged in New York, Miami and Palm Beach, Florida, during the second quarter, while declining across much of the rest of the world, according to a new report.
According to a report by real estate firm Knight Frank, the number of homes sold for $10 million or more in the second quarter rose 44% in Palm Beach, 27% in Miami and 16% in New York.
New York led the U.S. with 72 sales over $10 million, the highest in two years, the report said. Miami came in second with 55, followed by Los Angeles with 42 and Palm Beach with 36. Los Angeles saw a 29 percent decline in sales over $10 million, largely due to the new “mansion tax,” which imposes a 5.5 percent tax on homes sold for over $10 million, the report said.
The biggest sale of the quarter was May's $150 million deal for Palm Beach's only private island, reportedly bought by Australian infrastructure investor Michael Dorrell, according to the Wall Street Journal. In June, a historic 3.2-acre estate in Palm Beach sold for $148 million, while in Manhattan, the penthouse at the Aman New York sold for $135 million in July.
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While demand in many top luxury markets is easing from its 2021 peak, super-rich buyers continue to pay record prices for rare trophy properties, thanks in large part to rising financial markets, Knight Frank said.
“Growth in the global super prime market has been supported by significant wealth creation,” said Liam Bailey, global head of research at Knight Frank. “The transformation of markets such as Dubai, Palm Beach and Miami has more than offset the slowdown in some more mature markets.”
In the 11 largest luxury markets worldwide tracked by Knight Frank, sales of homes valued at over $10 million fell 4 percent year-on-year to $8.5 billion.
Dubai leads the world in luxury real estate with 85 sales in the second quarter, the report said. The city has seen a stratospheric rise as the super-rich from Russia, China, Europe and other regions moved to Dubai for its favorable tax and regulatory regimes. In 2019, there were only 23 sales above $10 million in Dubai. There were 436 sales in the past 12 months – although sales in the last quarter were down slightly from the previous year and the first quarter, Knight Frank said.
London saw one of the sharpest declines in the world, with sales of homes valued at over $10 million falling 47 percent year-on-year, according to Knight Frank, amid fears of higher taxes for wealthy Britons.
Although buyers of ultra-luxury properties typically pay for their properties in cash, falling global interest rates are expected to lead to increased sales in the second half of the year, the report said.
According to the Olshan Luxury Market Report, 29 contracts for properties valued at over $4 million were signed in Manhattan last week – the strongest post-Labor Day week since at least 2006.
“With interest rates falling, total transaction volume is expected to increase slightly through 2025,” Bailey said.