Kelcie Sellers is World Research Associate at Savills World Research
The emphasis on individual and collective wellness has never been higher in the wake of the pandemic. For many, this is evident in our lifestyles, the things we look for in our homes, and the wider locations we choose to be our primary and, increasingly, second residences.
More than ever, wellness has become a high priority for many across the property spectrum but especially for prime property buyers. Green space, wellness credentials, and larger homes are all now front of mind, for buyers are keen to focus on their wellbeing. Locations that can capitalize on their wellness credentials are likely to continue to attract prime property buyers in the future.
For buyers looking to stay within the major world cities or return a few days a week from their new bases outside of the hustle and bustle, pieds-à-terre and other city properties in ultra-desirable locations still have significant appeal. This resurgent demand boosted capital values for prime properties across the 30 cities covered by the Savills World Cities Index by an average of 3.2% in 2022.
Hybrid working has allowed greater flexibility and has prompted a re-evaluation of priorities. These changing lifestyles have led prime purchasers to demand greater indoor and outdoor space, as well as focus on purchasing the right property in a central, well-connected location. This shift in priorities demonstrates that wellness trends are not limited to the second home market but have become integral criteria for any property search.
After over two years of pandemic-related lockdowns and hybrid or fully remote working, many holiday destinations have seen a surge of second home buyers searching for space, an escape from city life, and a place to focus on themselves. However, because many are still tied to their offices for a few days a week, ease of access to major world cities remains a priority. Hybrid working has been widely discussed, but the trend of ‘hybrid living’ — increasingly splitting time between a city base and a second home — is beginning to take off.
It is because of these hybrid living trends that the locations that are most appealing for prime second home buyers are evolving from far-flung locales requiring lengthy travel times to places that are closer to home. Many prospective buyers are looking for destinations within two to three hours either by plane, train, and, more increasingly, by car from their main city base. These shorter travel times enable owners to use the second home properties more frequently and for longer periods of time while also allowing for easy access to major cities — turning some traditionally seasonal destinations into lively year-round communities.
As in the market for primary residences, buyers are looking for accessibility, more space, more top-tier wellness amenities, and better connectivity in their second homes. Being able to effectively and easily split time differently between primary and secondary residences is becoming more important for buyers looking for prime property.
Because many people do not need to spend as much time at their primary residences and do not go to the office daily, second home locations are seeing residents stay for much longer periods of time, with sunny, snowy, and countryside locations all experiencing the same benefits. Savills ski agents are reporting that compared to pre-pandemic levels, 60% of owners are now working remotely from their ski homes, able to extend their season on the slopes while meeting their work commitments.
Sunny locations are also seeing the benefits — the traditional stay of about two weeks for international homeowners in the Caribbean during the high season has stretched into two months or even longer as owners want to spend more time in these secondary residences. Some world cities have also seen their commuter belts widen, as residents of country homes are much more willing to travel into cities if they do not have to make the journey every day.
Some have taken hybrid living a step further and have become full-time executive nomads — living and working remotely from completely different locations from their home bases. Lisbon is the top location for executive nomads because of its high quality of life, comparatively affordable prime residential market, and strong physical connectivity. Miami and Dubai are also top locations with warm climates, strong connectivity, and plenty of big city benefits. For executive nomads looking for slightly snowier locales, Whistler Blackcomb takes the top spot with a vibrant village, plentiful snow, and attractive prime property prices for prospective sNOwMADs.
Prime residential markets had an exceptional run moving out of the pandemic. That level of growth has since slowed, but we should start to see improving economic conditions feed through to market performance towards the second half of 2023.
This segment of residential property is generally less reliant on debt financing and remains an attractive asset for wealth preservation and capital growth prospects. Though inflation and rising interest rates may give some buyers a temporary pause, it remains likely that prime residential locations will continue to attract buyers.