First-time buyers entering the market with help from the bank of mum and dad. Interest in serviced residences . Ethical luxury. And a new “boomerang buyer” phenomenon. These are some of the global real estate trends identified in Sotheby’s International Realty’s (SIR) “2022 Luxury Outlook”. On top of the price gains that many markets recorded in 2021, most industry analysts spoken to for the report predict prices will increase further throughout 2022, especially after the slower northern winter months. The luxury London mansions of India’s richest In the forward, A. Bradley Nelson, chief marketing officer, Sotheby’s International Realty, notes that as borders reopen, pent-up demand from international buyers will compete for limited inventory with local buyers. That might spell good news for financial capitals, many of which bounced back more quickly than expected post-Covid lockdowns, he adds. “But if 2020 and 2021 were fuelled by remote work, we’re predicting that in 2022, hybrid work is likely to drive the market, with many looking for larger homes that can accommodate remote work yet remain within commuting distance to their office,” Nelson says. Millennials make their move One interesting trend identified in the report is that millennials are entering the home-buying market en masse, shedding their title of the “renter generation”. This might partly be attributed to a mindset pivot as these young workers reach new life milestones, but they still rely on a leg-up from family. Move over, Selling Sunset: meet Netflix’s Selling Tampa star Sharelle Rosado “Most millennials are utilising a transfer of wealth from their parents, grandparents, or a relative to purchase property,” says Jonathan Spears, an agent at Scenic Sotheby’s International Realty, based in Destin, Florida. “And even when parents are buying, their millennial kids are often the ones making the decisions because it’ll be theirs one day.” According to a survey by US mortgage company Freddie Mac, the number of young American adults aged 25 to 34 purchasing homes with a co-borrower aged 55 and up has been on the rise for decades, accounting for 3.2 per cent in 2018, compared to 1.3 per cent in 1994. Expats go home The “boomerang buyer phenomenon” – attributed directly to the pandemic – is explained as a trend among expatriate workers who, taking advantage of work from home policies, are rushing to purchase property in their home countries. Asserts the report: “Nearly two-thirds of expats worldwide had considered purchasing a property in their home country as a result of the pandemic, the Financial Times reported, with 29 per cent planning to move back full time and 57 per cent seeking a home for future use. The Economist recorded a mass exodus of expat workers from Asia, with more than 15,000 choosing to return to the US alone. This boomerang-buyer trend is set to continue into 2022.” It finds that Australia and New Zealand in particular are experiencing an influx of expat buyers in search of luxury property. Of a million New Zealanders living abroad, a record 50,000 had returned by May 2021, more than at any time since the 1970s. The country’s median house price increased 19 per cent for the year to April 2021, and high-end luxury properties are particularly coveted. “Definitely the biggest increase in demand is in that super-high-end (around HK$53 million),” says Mark P.A. Harris, co-founder and managing director, New Zealand Sotheby’s International Realty. Inside Jeff Bezos’ new US$78 million Hawaiian mansion Branded, serviced and sustainable Branded residences, along with serviced apartments, are expected to continue their current growth momentum too. “Those Bentley, Aston and Porsche (branded) towers in Miami have hit some zeitgeist nerve, because people are buying them, they’re cool, and there’s a novelty factor,” says Chris Graham, founder of London-based luxury real estate branding consultancy Graham Associates. With 130 brands already in that space today, Graham predicts at least another 40 will enter the category within the next three or four years. As for short-term stays, Guy Bradshaw, managing director of United Kingdom Sotheby’s International Realty, says his rentals team has seen a “massive increase” in clients requesting serviced apartments, rather than hotels or private residences. “We’ve had very top-level executives taking fully serviced accommodation for £60,000-70,000 (HK$638,000-745,000) a month,” he says. With ESG (environmental, social and governance) on everyone’s agenda, expect more socially conscious investment options coming to market, benefiting the wider community. Brokers back this up, citing consumer demand. Kevin McDonald, sales associate, Sotheby’s International Realty – Wine Country brokerage in the US, finds ESG-aware buyers are bringing their environmental preferences to the buying or construction processes. In addition to asking about sustainability features, “they want to know what impact a property has on the land and resources”, he says. How have serviced apartments managed to thrive amid Covid-19? In his wine country surroundings, McDonald notes a growing collection of turnkey properties with sustainable features, making it easier for buyers to invest in such homes without having to make their own eco-conscious renovations. And, they’re prepared to pay, with buyers’ principles winning out over the costs of sustainability. A strong focus on environmental impact is also evident, especially in ecologically fragile regions. Jonathan Sparrow, sales partner, Cayman Islands Sotheby’s International Realty, has seen this trend increase in homes built over the last five to 10 years. “Private homeowners and resort developers are willingly investing additional money to lessen ecological impact,” he says. “A great example is turtle-friendly lighting that doesn’t disorient new hatchlings [by] drawing them away from the water’s edge when their natural inclination is to follow the moonlight into the ocean.” Asian outlook Among the markets to watch in 2022, SIR’s report singles out Japan as a potential investor hotspot in Asia, noting that there are no legal restrictions on foreign nationals buying land or property there, and that they are subject to the same taxes as domestic buyers. In addition to Tokyo, other “mature and stable” areas like the city of Kyoto, and the islands of Hokkaido and Okinawa, are mentioned. According to the report, the Hong Kong property market “could be poised for a lift from the pending influx of investment from mainland China when borders open again”, coupled with the opportunities emerging from the Greater Bay Area development. Living in a hotel? How branded residences became the next luxury property trend Dominic Volek, group head of private clients, Henley & Partners, also believes that Singapore, long known for attracting international wealth due to its mature financial services infrastructure and liveability, is becoming more attractive due to the efficiency with which its government has dealt with the pandemic. Indicators might well suggest that luxury home hunters will be out in force this year. However, given that governments and city authorities around the world are looking to property as a source of funds to help combat the economic effects of the pandemic, SIR’s report also flags changes in fees and taxation that may influence buyers’ real estate investment plans. In markets ranging from the US states California and Hawaii, to France, Ireland, Oman and Australia, the report explores jurisdictions where “a bundle of new taxes that will affect the property buying and selling process have been introduced or proposed, with many of them aimed at high earners”. Key takeaways The biggest real estate narrative of 2022, according to Philip A. White Jnr, president and CEO, Sotheby’s International Realty, will be the return of the international buyer. Whereas 2021’s story was a bounce back to city living, as borders opened and vaccines rolled out, overseas investors are now expected to pounce. In the US, White cites Florida as “pretty much the hottest market in the country”, followed by Texas, Colorado and California. Elsewhere, areas such as Sydney in Australia, Greece and the French Riviera “have seen a surge of interest from buyers, including foreign investors, which saw an increase in both inquiries and home prices”. Want more stories like this? Follow STYLE on Facebook , Instagram , YouTube and Twitter .