Jing Pan
5 min read
With the stock market on a rollercoaster ride, recession warnings piling up and interest rates still elevated, you might expect Americans to hold off on big-ticket purchases. But for the ultra-wealthy, there’s one thing they’re still snapping up, even amid the chaos: luxury real estate.
According to a new Wall Street Journal report, the number of U.S. homes sold for $10 million or more has surged in major markets since February.
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In Palm Beach, Florida, the number of $10 million-plus home sales jumped 50% between February 1 and May 1 compared to a year earlier. In Aspen, Colorado — a luxury ski destination — sales climbed by 43.75%. Los Angeles County followed with a 29% increase, while Manhattan saw a 21% uptick.
For some, it’s a way to sidestep market volatility and preserve purchasing power.
“The chance of taking a hit in the stock market is a bit too high for the reward, especially when we consider inflation,” said applied mathematician-turned-entrepreneur Dan Herbatschek. “Real estate is safer, less volatile.”
When inflation rises, property values often follow, driven by the increased costs of materials, labor and land. Rental income tends to rise as well, offering landlords a revenue stream that adjusts with inflation.
Herbatschek recently signed a contract to purchase a $12.25 million five-bedroom condo in New York City’s Upper East Side for his family, and he’s also acquiring three investment properties priced between $2 million and $5.5 million.
Meanwhile, billionaire manufacturing executive David MacNeil has been expanding his footprint in Manalapan, Florida. In March, he signed a contract to buy a $55.5 million property next to a site he already owns — bringing his total real estate spending in Manalapan to a staggering $94 million over the past year.
And he’s unapologetic about the price tag.
“There’s really no bad time to buy great properties,” MacNeil remarked. “No one ever regretted buying the very best, whether it is a premium collector car or a piece of premium real estate. Scared money chases bargains, and smart money chases excellence.”
To be sure, real estate isn’t just for the ultra-wealthy. Regular Americans can benefit from it, too — just ask homeowners.
