In the U.S. Condo Market, Luxury Units Are Trending — the Rest, Not So Much

“This is rare.”

The first words that appear on the website of Privé Malibu, a newly converted luxury condominium in Malibu, Calif., aren’t just a marketing ploy. The complex, where units range from $2 million to $4.5 million and where actor Charlie Sheen may or may not be an owner, are quite literally the first condos to be listed for sale in the coastal enclave in decades. 

Developing housing of any kind in Southern California is notoriously difficult, particularly in its smaller, wealthier cities, but many notable projects these days are condos. Not just any condos, mind you. Ultra-luxury, premium, branded, highly amenitized condos are all the rage in cities like Beverly Hills, West Hollywood and on Los Angeles’ Westside. Branded residences are developments attached to major hospitality or lifestyle companies, such as Waldorf Astoria, Cipriani or even luxury car manufacturer Bentley.

Think Nahla Capital’s Rosewood Residences project in Beverly Hills; Crescent Heights’ Ten Thousand conversion proposal in Brentwood; or Aman’s incoming towers at Cain’s $10 billion One Beverly Hills project, which are reportedly priced at $20 million to $40 million per unit. The trend isn’t exclusive to California, as high-end condominium properties are generally outperforming their lower-priced counterparts across the country. 

Yet therein lies the rub. The nation’s condo industry, much like its housing situation in general, is often a tale of two markets split between the haves and have-nots. Flight to quality is the pervasive post-pandemic trend, but only for those who can afford the ticket. 

“People are looking for higher quality, and the ‘branded’ trend is sort of a signaling factor in condos for quality,” said Ryan Schleis, senior vice president of research and analytics at Corcoran Sunshine. “We’re also seeing, especially in markets where there is a larger supply of existing and new development condos, quality also being signaled by higher-end design. That’s illustrating how the high end is really strong, and is pulling in these different factors that drive value and pricing and premiums that we’ve seen in New York for a long time … and is expanding to some of these other markets.”

This focus on the luxury end, though, is distorting things across the broader condo market, Schleis added. 

“But I think that because there is such a focus on the luxury market, there is a huge portion of the market that is being missed and that is not being served,” he said. “Given that I live in New York — and I live and breathe this market the most — I see that here, especially where there is a real lack of supply in our market. I’d say units under $2 million — that benchmark will vary, of course, depending on what markets we’re talking about, so that number might be lower somewhere else — but there’s a real lack of supply under that price point, and it’s very, very hard for new development to fill that gap, just because of the fundamentals.”

Consistent and reliable national statistics on condos are few and far between, but much can be extrapolated from broader trends. As of at least February 2025, homes priced at $1 million or more were the fastest-growing sales segment nationwide for 21 straight months, according to a Realtor.com report at the time. Sales in that price block accounted for 7.6 percent of the market, compared to 5 percent just two years earlier, per the report. 

While homes priced at $1 million are not inherently considered “luxury” in pricey coastal cities like New York, L.A., San Francisco and Boston, the segment’s growing activity does indicate the kinds of properties becoming available, and who is buying them. 

Probably the biggest driver behind these trends is cost escalation. The sharp costs of urban infill developments — including for the land itself as well as for labor and construction materials, particularly since the pandemic — not to mention anti-development attitudes in certain cities have naturally pushed many developers toward the top end of the market. 

If land and construction is expensive, and permits are hard to come by, developers often default to maximizing potential revenue by targeting the wealthiest potential buyers, even during an affordability crisis. The amount of branded residences across the country grew by 150 percent from 2012 to 2022, and is expected to double again by 2027, according to a 2022 report by Savills. 

The amount of people ready and willing to purchase these kinds of residences is growing quickly, too, at least among folks already in the top 1 percent of global wealth. The amount of ultra-high-net-worth individuals (UHNWI) has skyrocketed in recent years, driven by particularly strong global stock performances. There were nearly 511,000 of these individuals — defined as having a net worth of at least $30 million — across the globe in 2025, a surge of 12 percent year-over-year, according to a recent report by wealth data analytics firm Altrata. By 2030, the UHNWIs population is expected to jump by another 30 percent.

Ultra-luxe condo developments, such as the Aman-branded homes at One Beverly Hills or the Cipriani Residences development in Miami, are often aggressively marketed internationally, not just locally. That’s in part to attract as much interest from UHNWIs as possible. These properties feature amenities not unlike five-star hotels, including butler and concierge services, exclusive spa and wellness spaces, high-end restaurants, professional-grade sport facilities and armed security. 

“We have a thing that I call ‘amenity wars,’ where one developer says, ‘Hey, I’ve got 17 amenities,’ and the other developer says, ‘Well, I have 18. I have a rock-climbing wall and a pet spa that you don’t have,’” said Jonathan Miller, president and CEO of appraiser Miller Samuel.

For buyers with means in Southern California, fire protection and insurance is also an attractive amenity, particularly in the wake of the 2025 wildfires that destroyed much of the Pacific Palisades and Altadena neighborhoods. Rather than deal with top-end insurance premiums for sprawling estates, let alone the enhanced risk of a fire tearing through exclusive communities perched in canyons or on coastal bluffs, some of the region’s uber-wealthy are opting to move to protected condo buildings with more predictable HOA fees, according to Tomer Fridman, executive director of private wealth and luxury estates at Christie's International Real Estate Southern California.

Yet, the reality is that Southern California, and Los Angeles in particular, is largely a rental and single-family home market, even for high-end properties. There had only been intermittent bursts of condo developments in the city during the 1980s, and again in the late 2000s during Century City’s revitalization, Fridman said. Or at least that was true until relatively recently.

“I think there’s a huge renaissance in L.A. for the condo market,” Fridman said, speaking of the luxury end in particular. “Initially, it was really a single-family market in terms of the luxury market, and even the sub-luxury market. However, we’ve seen in certain elements, such as age demographics, security risks, crime, fires, all of that, that people just want less hassle in terms of having to worry about their homes. You have to understand L.A. isn’t known as a condo market, but not just because there wasn’t an appetite for it. There wasn’t any actual product. There was never really an estate alternative. But it was almost as if: If you build it, they will come.”

Many UHNWIs, meanwhile, tend to purchase these high-end condos as investment vehicles. That’s particularly true in times of macroeconomic uncertainty because real estate assets are viewed as generally stable, and a hedge against inflation. War, global tariffs and frequent interest rate fluctuations, such as those seen over the past 12 months, fuel that kind of uncertainty. 

Nearly 80 percent of “U.S.-based, high-net-worth customers,” surveyed for a 2022 Coldwell Banker report on luxury real estate, said that they owned an investment property. Of that total, nearly two-thirds said they owned two or more investment properties. And 34 percent of respondents said that apartments and condominiums were a priority for property investments. In a midyear 2025 luxury real estate report from the same brokerage, more than two-thirds of property specialists in that end of the market reported that their clients were maintaining or increasing their real estate holdings — and nearly all Coldwell Banker specialists said all-cash purchases were rising or at least holding steady. 

Still, the pool of potential buyers capable of purchasing condos priced at $5 million, $10 million, $20 million or more remains extremely small, whatever the growth in ultra-high-net-worth individuals. Overbuilding is therefore an inherent risk, particularly in cities with robust competition. 

In Boston, for example, sales of units priced $3 million or more were down 35 percent in 2025, according to Boston-based real estate broker Ford Realty. Units priced at $10 million or more in the city are projected to take at least 18 months to sell, per the brokerage, and have led to significant buyer concessions. The keys to the 114-unit St. Regis Residences, developed in 2019 on Boston Harbor, were handed back to its lender last year, as roughly 40 percent of the building’s units had yet to trade. 

Yet, the U.S. condo industry is not a monolith. In 2025, South Florida posted the highest volume of $20 million or more condo sales in the region’s history, according to a February report by Miami Realtors. In Miami-Dade County, sales of condos priced $1 million and higher rose by about 21 percent annually in January, from 103 to 125, per the report. That sales growth also extends to relatively affordable new condos in the county — priced between $500,000 and $600,000 — which grew by a modest 1.5 percent year-over-year. 

Still, despite a 4 percent bump in 2025, new inventory in South Florida is starting to slow after years of development boom. Total available inventory across the region, at nearly 18,000 units, is still 25 percent below 2019 levels, according to Miami Realtors. Unsurprisingly, prices are trending upward. That’s just as true for more affordable properties as it is for the luxury market. Average existing condo prices in Miami more than doubled from January 2016 to January 2026, from $205,000 to $420,000, according to Miami Realtors. 

While the condo inventory story is variable from market to market, lack of supply and shrinking pipelines represent a consistent trend in many regions nationwide, Miller said. That goes back to the pent-up capital and lower mortgage rates post-COVID as Americans went on a buying spree.

“Inventory is the key data point, and it varies across regions and local markets, and it really tells different stories,” Miller said. “The whole country, coming out of the pandemic, was devoid of supply, but certain parts of the country were able to create more housing stock quickly, primarily the Sun Belt states like Texas and Florida. Those areas were able to build a lot more rentals, a lot more condos, a lot more single-family than you can in the Northeast, partly because of land and partly because of friendlier development environments.”

This has led to a geographic divergence in condo supply.

“So the Northeast and the Midwest right now are devoid of inventory,” Miller said. “There’s a lot more inventory in the Sun Belt states, and Western region of the U.S. is sort of in-between — too much and not enough. Some markets there, especially in Southern California, are really devoid of supply. But other markets, like some in Northern California, have more supply. So not everybody is the same. 

“But, broadly, on a regional basis, inventory varies a lot, and inventory basically determines the housing narrative,” he added. “And prices are generally rising more in the Northeast and Midwest, because inventory is more of a challenge. … 2026 represents lower supply in the new development space throughout the year.”

Nick Trombola can be reached at ntrombola@commercialobserver.com.