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Home Sweet $100 Million Home

After experiencing an extraordinary surge in demand for housing over the past two years, real estate has suddenly found itself facing some powerful obstacles: Historically high inflation. Sharply rising interest rates. Significantly reduced new housing starts. Yet the ultra luxury market has remained largely unaffected, with nine-figure sales more common than ever.

 

 

“It’s the Law of Scarcity”, explains Compass agent Steven Shane. “The ultra luxury sector keeps climbing in value because these legacy properties are not just spectacular, they are one-of-a-kind. Prices keep escalating because demand for one-of-a-kind is greater than supply.” Shane is currently the listing agent for $100 Million 730 S Galena Street, one of only three single family ski-in, ski-out homes on Aspen Mountain. For the privilege of this level of direct ski access at one of the world’s premier snow destinations, price is no object.

 

 

“Tommy Hilfiger purchased one of the other two single family homes with direct ski access on Aspen Mountain in December 2021. Just weeks later, a buyer approached me with very strong interest in the property even though it clearly was not for sale. This buyer would not be deterred and in February 2022, we closed the deal for $20 million above what Tommy had paid. That’s $20 million in profit for two months of ownership. There is always a buyer for the best.” With respect to his 730 S Galena listing, Shane reports having sizable interest in the property from prospective buyers and not one has pushed back on its asking price.

 

 

Compass agent Sean Matthews describes similar ultra luxury demand in the coastal California communities he serves, specifically the stunning “Rancho Carinoso” property in Carpinteria, CA he is representing with Eric Haskell of The Agency for an asking price of $109 million. “This is a singular legacy estate,” says Matthews. “It is the only beachfront property in California which is ranch-zoned, and it is not located atop a bluff, like most homes on Padaro Lane. It is a forest-like oasis from which you can emerge on horseback to ride directly onto the beach along the Pacific Ocean. Padaro is one of the most prized streets across the globe. Kevin Costner lives next door. ” 

 

 

Both Matthews and Shane delved deeper into discussions about how ultra high net worth individuals use real estate as a hedge against inflation. After all, most buyers at this price point pay cash when purchasing homes and therefore are not at the mercy of rising interest and mortgage rates. Luxury investments are further advantaged when purchasing in a low tax rate state, such as Florida. Compass Fort Lauderdale agents Tim Elmes and Angeline Earnest describe the huge impact this is having on their local luxury real estate market. Explains Elmes, “By purchasing a hard asset like an estate in Fort Lauderdale, the tax savings effectively pays for the home. It’s no wonder we are seeing such a huge influx of wealthy individuals purchasing here.”

 

 

Elmes and Earnest are the listing agents for  “La Maison Blanche”, a brand new coastal estate comprising three structures with multiple yacht dockage along 840 feet of waterfront. Its builders are set to break ground early 2023, and Elmes and Earnest are already fielding inquiries for the $120 million property. “This is the best site in Fort Lauderdale, bar none,” says Earnest. “Panoramic water views, waterfalls, dockage for yachts up to 250 feet, and designed by world renowned architect Rene Gonzales. Once construction is complete, La Maison Blanche will offer the ultimate high-end resort lifestyle with views that literally feel like you’re floating on the water. There is no other property in Fort Lauderdale which offers this level of luxury. This home will be record-breaking in every way.”

 

 

Whether a savvy strategy to preserve wealth or a trophy property for leisure and enjoyment with loved ones, high demand in the ultra luxury sector holds firm and at escalating prices. Will high demand for $100 million plus homes remain immune to a worsening economy? Only time will tell. But when considering the Law of Scarcity in relation to the singularity and irreplaceability of extraordinary homes such as these, it’s hard to imagine a scenario in which desire would wane. As Steven Shane says, there is always a buyer for the best.

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