Luxury Residential Markets Driven by Migration
Within the United States, job growth and regional migration patterns directly influence the housing markets, including the luxury sector. Job growth drives household formation, which drives housing demand with a nearly one to one correlation. Local and state tax and growth policies, cost of living and higher wages, better living standards and lifestyle choices, directly affect migration within the nation. These factors will continue to influence decisions on where to live through 2026 and beyond.
A well-documented trend is that both California and New York have been losing population, companies and jobs to Texas and Florida. Politics, taxes and laws in these states are part of the reason why. These factors are leading to capital flight away from these heavily taxed jurisdictions to more business-friendly states of Texas and Florida.
The Golden Triangle in Texas, consisting of Dallas, San Antonio and Houston, will continue attracting waves of singles and families from higher tax jurisdictions. The Palm Beach communities of Florida are also attractive to business leaders from the Northeast. These trends will continue driving the luxury residential markets in Texas and Florida. If 2025 was a good year for business, 2026 may become a stellar year. While attending the Chapman University Economic Forecast, it was noted that US growth nationally has averaged 4 to 4.5 percent. Florida and Texas are surging at 7 to 7.5 percent growth and California is lagging at 2 to 2.5 percent growth.
Why does this matter? Founders of companies leaving high tax jurisdictions include SpaceX, Google, Oracle, Citadel and Related among others. These business leaders are opinion leaders and influencers. Like “Trickle Down” economics, U-Haul data also mirrors these trends, reflecting larger numbers of people making choices to live in pro-growth, low-tax states. Other states benefiting from these moving trends include North and South Carolina and Tennessee.
In Florida, the luxury markets benefiting from these trends include coastal and inland cities alike. In South Florida, Miami and Miami Beach, Key Biscayne, Coconut Grove, Sunny Isles, Boca Raton, Wellington and Jupiter are havens of luxury developments. They continue to capture high value residents and record-setting price points. Many of these are waterfront and yacht- oriented, others are large suburban estates with golf or equestrian themes. In south Florida, newly constructed high-rise condos offer lifestyles commanding forever views. The Waldorf Astoria hotel and condo tower in downtown Miami is one example, soaring to 100 stories upon completion and replicating New York’s city skyline. Miami alone has several supertall towers underway and others proposed. In West Palm Beach, Stephen Ross’s luxury residential venture includes “South Flagler House,” reaching new historic prices. Record prices are achievable when paired with hospitality-grade services.
There are other high-priced residential markets in selected gated communities around Orlando and the Gulf Coast towns of Sarasota, Longboat Key and Naples. Affluent buyers prefer luxury enclaves offering privacy, security, abundant space and self-sufficiency. Some of the in-demand amenities include outdoor kitchens, indoor wellness centers and state-of-the-art technology connections.
Each of these communities add a new and more exhaustive amenity package to rival competitors in efforts to gain an edge in attracting sophisticated buyers with distinguished tastes in their housing preferences. These amenity examples include not only the highest quality kitchen designs, finishes and appliance packages, but also expansive sizes and wellness-concentric designs. This means amenities and features such as yoga and pilates studios, including circadian lighting and biophilic interiors, carbon neutral homes, homegrown food gardens, renewable energy systems and full smart home automation. These luxury residential solutions serve not only as comfortable homes but peaceful retreats and remote offices, exhibiting an environmentally compatible consciousness.
There should be optimism in the building industry and the economy, especially with the luxury market and within certain geographic regions. According to the Robb Report, the luxury housing market is heading into 2026 with a high level of confidence that other real estate sectors can’t claim. This was the clear takeaway from Sotheby’s latest outlook report, which draws on global sales data, agent surveys and buyer behavior at the top end of the market. After outperforming traditional real estate in both sales and value last year, luxury home sales are expected to keep their edge, fueled by wealth creation, international demand and deep-pocketed buyers who are far less rattled by interest rates than the average homeowner.
Don Neff is President of LJP Construction Services. For more information, visit here.
This is featured in the Green Home Builder February issue, read the print version here.