Where is the world’s most popular luxury property destination?
The world’s most sought-after luxury property destination is Côte d’Azur, France, according to a new report.
Prime property in Costa Smeralda, Italy, and St Barts, in the Caribbean, are the next exclusive property hotspots for ultra-high-net-worth individuals (UHNWIs), says the Candy GPS report.
“For summer sun, the Côte d’Azur is the world’s most expensive, and desirable, luxury leisure enclave. Easily accessible from Nice and Monaco, its exclusivity, as well as the warm climate, ensures that it remains a firm favourite with UHNWIs.
“Properties here are very carefully designed to maximise privacy and sometimes have a private beach. This is increasingly sought after as parts of the wider area become increasingly commercialised and urbanised,” says report author, Yolande Barnes, Director of Savills World Research.
The newly-published report focuses on the global luxury leisure market also lists more “local” leisure enclaves that are driven by domestic wealth and looks at the potential complexities of buying abroad in terms of cultural differences, legal and tax systems and financing.
A typical five-bed home in Côte d’Azur, France, costs around US$28.5million. Costa Smeralda property fetches around US$11.5million on average and St Barts homes are U$14million, the Prime Home Index states.
The Global Prime Sector’s top residential enclaves are ranked by global reach, real estate values, exclusivity and luxury tourism measured by the highest price for a luxury hotel suite.
The top 10 then features Aspen USA (US$13million), Monaco, (US$24million), Barbados (US$23million), St Moritz, Switzerland, (US$8.5million), Seychelles (US$8million) and Maldives (US$6million).
Much of the wealth is driven by Russian wealth, the report states. “The participation of this nationality in additional home buying is an extension of their “dacha” culture back home.
“Rich Muscovites have, over the centuries, owned both a city home and a country house, or dacha. This has been easily translated into the ownership of other status-enhancing properties across the globe.
“Modern Russian wealth flows primarily into the Mediterranean, the South of France, Italy and, increasingly, to emerging destinations in the Eastern Med such as Montenegro. Russian buyers are also particularly active in the United States and Caribbean.” says Yolande Barnes.
Middle Eastern buyers are also prominent group among prime home purchasers in leading leisure destinations. “Not surprisingly, they are already the dominant buyer group in Dubai and Abu Dhabi’s leisure developments, but they are also to be found in the key luxury Mediterranean resorts, and have been high profile investors in Marbella and the Costa Smeralda, or Emerald Coast, of Sardinia.”
Asia buyers play less of a key role. “Asia, in spite of having an UHNWI population of 43,000 individuals, does not have a culture where additional home ownership in leisure destinations is usual.
“The majority of homebuying activity in the Asia-Pacific enclaves such as Phuket and Bali, for example, has been by expats. Sun, sea and sand, for example, are less highly valued and real estate purchases are singularly concentrated in urban centres, rather than the countryside or seaside.
“Many of the newly wealthy in China view the countryside as inferior to urban environments. Some Chinese buyers have discovered the joy of vineyard ownership or skiing, but these remain in a minority compared to those preferring to buy into infrastructure projects, agricultural land or income-producing real estate investments in more rural areas.”
The Candy GPS Report is produced in partnership with Deutsche Asset & Wealth Management and with exclusive research from Savills.
Deutsche Asset & Wealth Management adds, “Buying a second home can be a mix of heart and head, prompted by a few fantastic weeks spent immersed in local wine, food, and culture. But alongside the romance there is an often complex reality: cultural nuances, tax systems, due diligence, and financing.”
It points out that investors from the East and the West often have different attitudes about overseas property investment.
“The Côte d’Azur and Alps have been playgrounds of the wealthy for over a century; however, many of the emerging wealthy in Asia and the Middle East have entirely different approaches to leisure time.
“Wealthy individuals in China have often built up their wealth, run operational businesses, and take very few holidays; when they do travel for pleasure their preference is often to explore cultural centres like London or Paris. Sun holidays are often an alien concept to people living in hot climates.
“These cultural differences don’t only impact leisure preferences. There is also a correlation between culture and investment return expectations. Clients buying in traditional holiday destinations are often less concerned with the liquidity of the market and costs associated with ownership.”
Source: OPP News
