After a roaring decade, real estate is looking a lot less promising in the 2020s.
A sense of gloom hangs in the air. “Bloodbath,” “free fall” and “slump” were just some of the choice idioms deployed by headline writers to describe the New York real estate market during the twilight of 2019. Across the pond, townhouses in central London—long the favored investment vehicle for billionaires from Bahrain to Belarus—have lost 20 percent of their value in a five-year nosedive. Worldwide, according to Savills, a global property consultancy, “everything is trending to zero.”
“This is not a normal cycle,” says Frederick Peters, CEO of Warburg Realty. Even after the global financial crisis, luxury property prices in the world’s capitals recovered fully within two years and went on to smash all records. This time round, brokers and analysts agree, it’s different.