18 Dec There have been several articles published lately talking about the return of luxury consumption. I believe it was the Wall Street Journal touting how Louis Vuitton stock has rebounded from the recession.

The article makes it seem like everything “luxury” is on the way up. The biggest mistake real estate professionals could make right now is to assume that this applies across the board for luxury consumption. Luxury real estate is no where near positive sales. In fact, I would say that until the consumer portfolios are back to what they were in 2006, we won’t see a serious turn around in the high-end market.

A real estate investment is a totally different buying decision than clothing or even an automobile. I hope that decision makers won’t allow wishful thinking to cloud their judgment.

The only high-end property moving right now is for investment purposes. If you have the cash to invest in a piece of property, you are primed for a great return. This kind of real estate purchasing cannot bring back the luxury market. The truth is that most of us don’t have those kinds of assets so the idea of a returning market in the immediate future is just not cutting it.

The high-end affluent market will come back one day- just like our economy. Unfortunately, I think it will be later than sooner. Don’t be fooled by consumer spending on unrelated products. I would consider these feel good items for the wealthy. Expensive handbags and fine art don’t belong in the same category as mansions.