UHWNI AND HWNI LEAD THE WAY !
The successive confinements linked to the health crisis, as well as the development of telecommuting, have only amplified the appetite of buyers eager to satisfy their need for space and nature. The rise of telecommuting has changed the way second homes are used. They are gradually becoming residences where people can spend up to 6 months a year. It’s no longer just the classic pied-à-terre for relaxing on weekends or vacations. Nowadays, mobile workers relocate their workplace to a new haven of peace several days a week, or even several months a year, while keeping their main home in the city. Many seniors are also adopting this lifestyle. The hybrid aspect of this second-home status means that it gradually transforms into a part-time main residence. Personal and professional spheres sometimes intermingle. Hybrid residences, known as “Branded Residences”, are emerging, offering a host of services for these new, hybrid workers, including business centers and co-working spaces.
ACQUIRING A TRADITIONAL SECOND HOME IS LESS ATTRACTIVE THAN OWNING A BRANDED RESIDENCE
Maintenance and renovation costs, as well as ongoing tax-related charges such as property tax, require substantial financial resources to acquire a traditional second home, and a financing plan is necessary before taking the plunge. What’s more, for a traditional second home, annual charges are typically estimated at between 3% and 5% of the purchase price.
Rental platforms such as RB&B or Abritel, aimed at second-home owners, have seen a significant increase. For busy buyers who live far from the property in question, or even abroad, maintenance and professional rental management cannot be improvised. That’s why HWNIs, who often own several residences around the world, prefer the “Branded Residences” acquisition formula, which offers numerous advantages and shows the way to buyers with a more modest budget of between €500,000 and €1,500,000 for the acquisition of an apartment or villa with premium services.
According to Knight Frank, the number of HNWIs increased by 5% in 2022 and could grow by 50% before 2032. The favorite urban destinations of these high net worth individuals in excess of $30 million remain London, followed by New York. The English capital also tops Christie’s International Real Estate’s ranking of the top ten cities for luxury real estate. The real estate market remains tight, with no reason for a downward trend, and values are peaking: from 12,000 to 40,000 euros/m2 and more for a London apartment.
Younger and younger players are emerging on the prestige real estate market. “Millenials (1980/1996) and Generation Z (1996/2010) have a vision of authentic, committed luxury that respects the environment. They are sensitive to the orientation of properties, energy consumption, the relationship with nature, the origin of building materials and respectful use”… explains Miguel Espada, President of the Propriétés & Co group, developer of the Port Marseillan eco-tourism projects. “The apartments and villas sold off-plan are designed to integrate into their natural, social, cultural and economic environment. It was essential to work on a site as sensitive as it is exceptional, with an architect and a hotel group sharing the same values !