With the start of the new season, we open a new section in the JamesEdition Journal; our “For Business” vertical will provide real estate professionals with insights and tips that range from the latest market trends to advice on how to boost listing performance on the JamesEdition platform.
In our first “For Business” article, Perlin Gentil, Head of Sales, elaborates on the current state of the luxury real estate market in Europe, based upon both JamesEdition’s insights and open-source data. You can watch the video or read the transcript below.
Hi, I am Perlin Gentil from JamesEdition.com.
I just wanted to shoot this quick video for you to share some very interesting metrics that we found online about the luxury real estate market in Europe. As you will see, the buyer demand is getting quite strong.
First, let’s start with [JamesEdition’s owned data] the Luxury Property Buyer Index [LPBI]. How did we build this index? This is actually data that we gathered from more than 4,000 buyers on JamesEdition. We ask them a very simple question when they look at a certain region: do you think the prices will increase, decrease or stagnate [in this region]? If they think the price will decrease, it means that they are quite pessimistic about the situation. If they think the price will increase, they are thinking the market is strong.
To simplify it, if we look at spring 2020 when the first lockdown happened in Europe and North America, we can see that the sentiment was quite pessimistic about the market. Then we had a bump in summer 2020, in September 2020, when a few countries reopened.
Since fall 2020, we see that the trend is going higher and higher [showing the graph]. Of course, the US market (here in light grey) always recovers faster, for all forms of crisis, it’s not a surprise. But we also see that the trend is going higher for Europe. A small dip here, nothing too preoccupying. But globally, we can really see that the sentiment is really optimistic. So that’s the first thing I wanted to share with you.
If we take again this Luxury Property Buyer Index, but for Spain only, and compare it with the home sales year-on-year in Andalusia, we can see a very strong correlation between the home sales and this Luxury Property Buyer Index. As you can see, the home sales in Andalusia in comparison to last year are really recovering: we can see a very promising trend.
Now let’s look at the home sales in the region of Malaga, versus the Google search in Marbella. We can see actually that it’s also totally recovered, and we are +25% for March-April 2021. Again, a very strong correlation with the Google search data year-on-year for Marbella luxury real estate: we see this crazy steep trend, and we see the +75% in comparison to last year.
So, let’s see if this correlates also with the sales. Let’s hope that this will follow by +50%, +75% — who knows, maybe +100% by the end of the year.
Let’s look now at Google search for Marbella. I’m speaking about a simple search: “luxury real estate Marbella,” with three different years: 2019, 2020, 2021. So, we can see that we started the year more or less at the same level, a little bit lower for 2021, but it’s recovering, and also the high season is starting way earlier than usual.
If we look at Algarve in Portugal, the year started, of course, lower. But now again is very steep demand and search on Google for Algarve luxury real estate. Let’s see if it goes higher than 2019 and be even better than just a simple recovery.
The same search for Tuscany in Italy.The same steep trend that you can see for 2021 in yellow.
And then French Riviera, South of France. And again, we find ourselves at the same level as in 2020, but a bit earlier: a month, 3 weeks earlier than usual. If it follows the same pattern that we have in the other regions, hopefully, we will go higher than 2020.
So, I’m only showing you here four key regions, but there’s plenty of other hot spots where foreign buyers are searching for properties and looking at places to invest now. This is actually quite cool to see this growing and quite promising for the second half of the year 2021.
I hope this was insightful, and that you are well-prepared for the tsunami of leads and sales coming before the end of the year.