BEVERLY HILLS, Calif., Jan. 28, 2022 /PRNewswire-PRWeb/ -- Global real estate brokerage The Agency is proud to announce the launch of its second annual Red Paper, an extensive market report compiled of the latest data, research, and insights on real estate market performance throughout the U.S., Canada, Mexico, the Caribbean, and Europe in 2021. The Agency's 2021 Red Paper details the activity in the 48 markets the brokerage serves and reveals dramatic shifts in home-buying trends, buyer demographics, home design, and more.
"This year's Red Paper showcases the power of the residential real estate market, proving that despite circumstances, people will always be on the move in search of the perfect place to call home," said Mauricio Umansky, CEO and Founder of The Agency. "As The Agency celebrated its ten-year anniversary milestone, we were once again there to heed the call from buyers, sellers, and agents around the world, and the Red Paper encapsulates our thorough research and analysis of last year's unprecedented market activity and the future of our industry."
The Red Paper reveals continued record-level activity despite the global impact of COVID-19, and significant trends that will influence the market for years to come. Looking forward, The Red Paper revealed one theme that was shared by all of The Agency's global offices: the future of real estate is now. As the market has shifted, so too have the needs and wants of buyers, sellers, and agents alike. The digital age of real estate is upon us, with everyone at the table wanting a more streamlined, seamless buying and selling experience. At the heart of this modernization is the real estate agent, who provides the human touch as the integral local expert and personal guide.
"There is no denying that the future of the real estate industry is here. The pandemic-induced market conditions of the last two years have swelled innovation, bringing consumer-facing technology to the forefront of the industry," said Rainy Hake Austin, President of The Agency. "As a brokerage, we plan to continue to serve as a preeminent leader as we leverage and invest in new technology, elevating our caliber of service and offerings to include NFT's, cryptocurrency, Proptech, and data platforms that create ease in the transaction process while fostering the human connection and never losing sight of the immense role of our agents. As evident in our Red Paper, The Agency's global success in 2021 is a testament to our resounding mission of balancing touch with tech - a first for our industry."
Highlights from The Agency's Red Paper include:
Tight Inventory and High Demand: Despite the year's tight inventory and rising prices, over six million homes sold, the highest since 2006. And new reports show that millennials accounted for more than half of all home loan applications, signaling that the dream of homeownership is alive and well. However, many would-be buyers were competing with baby boomers who had more equity, pricing them out of the market and bringing affordability to the center of the conversation.
Resort-Style Living Soared: Outdoor spaces were top of mind, with pools trending coast to coast from Washington D.C. to Victoria, while sports courts remained a hot amenity. Destination markets, including Carmel, Wine Country, Aspen, Park City, Maui, Mexico, and the Caribbean turned up the heat, as remote workers opted to enjoy resort-style living. They snapped up vacation homes they could enjoy for more of the year and rented out as income properties for the rest. The rental market across the globe was at an all-time high as demand again outpaced supply.
The Digital Age is Here: One trend that took off in 2020 was further solidified in 2021: More home shoppers are taking to social media, driving sales in every market. Leads and referrals from social media surged higher as more informed and savvy buyers took advantage of the tech platforms that made pricing and home tours more accessible. With connectivity happening in real-time, the agent's role became even more crucial. Agents helped clients navigate the tech landscape, gain access to listings before they vanished and get the upper hand in the 2021 bidding wars.
A Great Migration: The ultra-luxury markets of Los Angeles saw the greatest movement among local buyers trading up, while international investors began to return by year's end. Denver emerged as a post-pandemic favorite, seeing a rush of buyers from the coast attracted to the comparably affordable pricing, flourishing job market, and wide-open spaces. Las Vegas and Scottsdale welcomed a rush of buyers from California, Seattle, and Chicago seeking sunny weather and even sunnier tax benefits.
Turn-Key is King: Supply chain constraints have curbed buyers' appetites to take on renovations, seeing the demand for turnkey homes surge. In such a competitive market, however, buyers aren't holding out for the one. Accustomed to shopping online and eager to invest, these tech-savvy buyers have turned to new tech and social media for up-to-the-minute updates on available inventory. More and more buyers are accepting homes as-is and deferring updates until timelines for projects stabilize.
Northern California: Bay Area buyers wanted wide-open spaces in 2021, trading in proximity to life's conveniences for square footage. Many San Franciscans migrated to the North Bay, East Bay, SF Peninsula and Wine Country to enjoy spacious yards, outdoor experiences and beautiful scenery as they worked remotely. Even with this movement, San Francisco remained a hotspot, with strong demand across all districts. Within the city, single-family home and condo sales were up 33% and 40% respectively over the year before. Like other markets across the globe, demand and prices were on the rise and buyers had their eyes on homes with Zoom rooms and flexible spaces.
Southern California: In the great reshuffling of Los Angeles, demand remained high in the Platinum Triangle's coveted neighborhoods of Bel Air, Beverly Hills and Holmby Hills, but this past year saw more local buyers scooping up primary residences and fewer international buyers investing in secondary homes. Single-family home sales were up 32% and the median price rose 24%, while the condo market saw a significant 116% rise in sales with prices holding steady year over year. Los Angeles saw 20 sales over the $50M range as a new set of homebuyers brought lists of needs reassessed during the pandemic, which counter some of the most popular trends of the last few decades. Most notably, the open-concept home has lost some of its allure as buyers seek individualized spaces for work, study, fitness, and entertainment.
Aspen: As one of the world's most celebrated mountain destinations, Aspen again had a record-breaking year with over $545M in $20M+ sales on the books in 2021. By year's end, there were 6 properties over $30M under contract, proving that in Aspen, $30M is the new $20M. Even homes purchased during the pandemic saw price appreciation over a 12-month period, and all-cash deals made up an estimated 80% of the market. The median sales price for single-family homes rose to $10M, an 8% increase over the year prior. Buyers from L.A., Chicago, Dallas, Houston, New York and the Northeast again chose to spend more time in their vacation home, working remotely and enjoying Aspen as more of a primary residence.
Maui: Any home is the dream home when it's by the beach in Maui. That was certainly the sentiment among buyers as demand reached an all-time high and inventory dipped low in 2021. At the start of December, there were only 12 homes and ten condos for sale in Wailea, a stark contrast to the 30 homes and 90 plus condos typically available. Luxury buyers came in droves, hitting record-breaking numbers in sales with higher-priced homes, many above the $40M mark, moving faster than before the pandemic.
Boston: There's much to love about Boston city life—the restaurants, nightlife, sports offerings, top universities, and singular culture. It's no wonder the market saw double-digit, year-over-year growth as buyers migrated back to the city in 2021 to be closer to the action. Among the emerging markets was the Seaport, thanks in part to the arrival of more luxury and boutique options, including the St. Regis Residences. Q2 alone saw a 382 percent growth, with average pricing in the Seaport rising 42 percent. East Boston also had its day in the sun, with more available inventory leading to a rise in sales as high as 250 percent in Q3.
Las Vegas: Attracted to the tax savings, property sizes and quality of life, more Californians have chosen to set up their primary residences in Nevada. In fact, more than 80% of Las Vegas buyers in 2021 have been California-based. In previous years, the market has seen a steady influx of SoCal buyers, but a new and steady stream of NorCal buyers has helped heat demand, leading to a prolific number of transactions in the luxury market and dwindling inventory. Surprisingly, homes in the seven-figure range have been seeing multiple offers. Overall, the number of single-family home sales and the median price both rose 19% year over year, while the condo market saw a substantial 127% rise in sales transactions.
South Florida: Buyers in South Florida were really seeking the good life in 2021: the beach, sun, and turnkey living. New development continued to rapidly expand in an effort to meet the soaring demand and re-balance a market that has been feeling the burn of tight inventory. The reality of multiple offers wasn't limited to real estate purchases; rental prices increased significantly, sparked by their own saga of bidding wars. In addition to New Yorkers flocking to South Florida, Californians headed to the Sunshine State with their eye on the prize: great beaches, warm weather, and increased cash in their pockets with the benefit of no state income tax.
Mexico: Why wait until tomorrow when you can enjoy paradise today? That was the sentiment among buyers who flocked to Mexico's scenic Pacific Coast including Los Cabos, Puerto Vallarta and Punta de Mita, leading to a surge in transactions in 2021 over the previous year. Condos were the hottest commodities, followed by single-family homes and undeveloped land. In Los Cabos, 2021 was the hottest market in history with single-family home transactions rising 126% and condos 192%. U.S. buyers hailed from California, Texas, and Seattle, while more Mexican nationals from Mexico City and Guadalajara invested in the market, with the new road from Guadalajara to Puerto Vallarta set to cut down on travel time from the city.
Canada: When you can golf, ski, bike and swim all in the same day, your city is bound to be a hotspot. Vancouver single-family home transactions were up 36% and the median price up 11% year over year. The big spike in demand caused a shift in consumer behavior. More families and millennial buyers were driven from the city center by high prices and headed to secondary markets on the outskirts in search of single-family homes with more square footage.
Lack of inventory is still the catalyst fueling Toronto's steep prices, which increased significantly in 2021. Residents of Ontario's capital city met a new single-family home average price of $2.5M, a 13% increase over 2020. Demand couldn't be satiated with inventory dropping significantly. It was a record-breaking year in terms of the number of homes sold and average price increase. Condominium sales were strong, with the number of transactions rising 36% year over year.
The second most populous city in the country, Montreal is Canada's economic and cultural hub, merging French and English culture throughout its distinct neighbourhoods. High demand sent the median price for a single-family home up 20% year over year, while the number of condo transactions rose 31%.
The Caribbean: Turks & Caicos told a new story in 2021—a tale of extremely high demand and low inventory. Single-family home transactions soared 167% with the median price rising 51%, while condo transactions rose an unprecedented amount year over year. Sales on the 40 picturesque islands typically take 18 months from initial listing to sale but were expedited to a nine-month timeline due to soaring demand over the last year. Buyers continued to seek out island living for second homes and investment rentals, but they were also looking to spend more time in their island homes with the newfound flexibility of remote work. The result: an increase in hybrid-use homes, occupied by the owner for a significant portion of the year and harnessed as rental income for the remaining months. In general, the rental market was extraordinary. Both long-term and short-term rentals were hot commodities, costing island visitors a pretty penny.
The Netherlands: Buyers remained mostly young and successful local couples over the last year. They had their sights set on homes that accommodated remote work with extra space. If they couldn't find the space they needed in the city, they headed to the outskirts and the nation's secondary markets. Additionally, sustainability and energy efficiency were top of mind, and homes with green features went fast.
Read The Agency's Red Paper in its entirety here.
About The Agency
The Agency is a full-service, luxury real estate brokerage and lifestyle company representing clients in a spectrum of classes, including residential, new development, resort real estate, residential leasing, and luxury vacation rentals. Since its inception in 2011, The Agency has modernized and advanced the real estate industry by fostering a culture of partnership in which all clients and listings are represented in a collaborative environment. Shunning the traditional brokerage model, agents share knowledge, spheres of influence, contacts, and expertise, ensuring clients better representation and a true competitive edge. The Agency has closed more than $41 billion in real estate transactions since its inception and has 850 agents in more than 48 offices in the U.S., Canada, Mexico, and the Caribbean.
Laura Corrigan, The Agency, +1 (424) 354-1078, [email protected]
SOURCE The Agency