Our round-up of global resorts illustrates some important global trends and some pointers to what might shape global retreat markets over the next decade.

The recovery in real estate values, 
which started in world cities in 2009, 
is now beginning to extend beyond 
the prime markets in those cities 
and towards retreats and resorts. 
With faith in many urban real estate markets now restored, it is now the turn of the second home and retreats markets to benefit from an inflow of capital from wealthy purchasers.

We anticipate that many residential retreats will continue to see price growth – of up to 10% in 2014. Some will see a return to their former peaks by 2019.

The market is likely to continue to be equity led rather than debt reliant. The easing of lending conditions in the industrialised economies will eventually be matched by interest rate rises, offsetting the attraction of borrowing. This means that transaction volumes are likely to remain lower than pre-2008 for some time.

2015 will see the rise of other prime jurisdictions, led by high quality, low supply markets, including prime hotspots in the Algarve, Balearics, Tuscany and Caribbean. For longer term investors the more fully discounted markets provide value and will see longer term uplift as supply rebalances. The markets of the Eastern Med and South Africa pose opportunities here.

There is a special category of residential real estate buyer attracted by world class heritage. The growth of these markets is dependent on the number of ultra-high-net-worth individuals willing to make such an investment of passion. We think that the sheer rarity and a growing interest in heritage and antiquities among this group will secure and even enlarge these markets – but over the longer rather than shorter term.

Overall, we foresee price growth resuming and continuing in most high quality residential retreat markets for the next seven years, concentrated in the prime sector which will be equity driven rather than debt reliant.

The highest performers will be those that benefit most from changing fashions and preferences among the world’s wealthy. These locations could be different from those that proved most popular prior to the crisis of 2008.

Taken from
Spotlight: Prime Residential Retreats 2014