The luxury real estate market entered 2025 with a sense of optimism, buoyed by a notable drop in interest rates at the tail end of 2024. This shift sparked a flurry of activity in Q4, setting a strong foundation for the new year.

Read the full North American Luxury Review to learn more.

In this month’s report we review:

• The first quarter of 2025 saw uneven start to 2025 with strong January activity, a February slowdown, and a solid rebound in March

• While interest rate cuts in late 2024 boosted buyer confidence in January, February saw hesitation due to global trade concerns, interest rate speculation, and market volatility

• However, March data revealed a strong recovery in sales and inventory, particularly in single-family homes:
  • Single-family home sales rose 7.3% year-over-year and 39.7% from February. Inventory for single-family homes increased 30.1% year-over-year; new listings up 33.8%

  • Condo/townhome sales dipped 4.9% year-over-year but jumped 26.4% month-over-month. Inventory for condos/townhomes grew 28.4% year-over-year; new listings rose 14.8% from February

• A profile of current buyers shows that they are increasingly lifestyle-driven, seeking properties that support wellness, remote work, and multigenerational living. Millennials and Gen Xers are entering the market, assisted by generational wealth transfer. These buyers are open to renovation-ready homes that offer long-term value and location potential. They view luxury real estate as a stable, long-term investment and wealth preservation tool.

• A profile of current market disruptors shows that:
  
  • Interest rate changes could influence market momentum going forward

  • Stock market swings may impact buyer confidence and timing of purchases

  • Rising tariffs and material costs could slow development and increase prices

  • Climate-related insurance costs and risks are affecting demand in vulnerable regions

  • Regulatory changes, including foreign buyer restrictions and luxury taxes, could shape market behavior

• Market sentiment remains cautiously optimistic with strategic, informed buyer and seller activity
  
• Success in 2025 hinges on clarity, market insight, and thoughtful decision-making.
  

For homeowners looking to sell or buy their luxury home in today’s market we recommend working with a realtor who can provide you with critical knowledge about your local market, maintain a high level of security during the transaction and knows how to leverage technology to provide maximum exposure and assistance.   

It is my responsibility as your REALTOR to ensure that when others around you are lowering their expectations, that this becomes the time for us to switch gears and discover how to leverage the market effectively to achieve your goals.