"Demand is normalizing, which we see as evidence of a more balanced market. Expectations of demand are still in the moderately high range, so it isn't a frenzied market, it is just a solid market. In virtually every market we are still seeing strong demand and, if it is a well-priced property, it's moving."
"I think that we are seeing a more rational market. When I look at the sentiment in the index, I think people are acting deliberately and with confidence as opposed to being excessively emotional, which is what we saw during the COVID period."
"Despite the slight decline, Christie's International Real Estate said the PSI points to a positive outlook for 2026, as the market is expected to moderate in comparison to 2025, but remain strong. Both supply and demand are moving to a healthier balance and pricing confidence is remaining steady."
The luxury real estate market shows signs of normalization in 2026 with a composite PSI score of 14.4, down from 15.6 in 2025. Buyer demand has cooled from 37.7 to 29.3, while price outlook improved from 13.8 to 14.6 and inventory conditions strengthened from -26.9 to -23.2. This moderation represents a shift from the pandemic-driven frenzy to a more rational, balanced market. Despite the decline, demand remains robust with well-priced properties continuing to move quickly across markets. The market is characterized by deliberate, confident consumer behavior rather than emotional decision-making. Supply and demand are achieving healthier balance, pricing confidence remains steady, and increased luxury inventory reflects consumers adapting to current price and interest rate conditions.
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