While 2025 battered the broader housing market with inflation, elevated interest rates, and rising labor and material costs, the luxury segment continued to thrive. “The luxury market has been extremely resilient and continues to outperform the overall market,” says Nishu Sood, a housing expert at John Burns Research & Consulting, an independent research firm specializing in real estate.
Yet this resilience masks a more complex reality. The upper end of the market is undergoing a fundamental shift—one driven less by aspiration than by anxiety. Many of today’s luxury buyers are making decisions through a lens of risk mitigation rather than creative vision. For design professionals, understanding these forces means recognizing that even as luxury real estate thrives financially, it increasingly values safety over statement-making. AD PRO spoke to real estate professionals, designers, and builders about this phenomenon in our report on the luxury real estate trends of 2026.
Beige Still Makes Bank: The Algorithm Is Dictating Home Aesthetics
Social media hasn’t just influenced aesthetics—it has narrowed what buyers consider acceptable. While the design world has embraced the return of color and maximalism (see AD PRO’s 2025 Color Trend Report), the real estate market has not yet caught up. “The ‘50 Shades of Beige’ look, where all the furniture is off-white and the walls are all white Sheetrock, is still a go-to,” says AD100 designer Ross Cassidy. “The algorithm has radically flattened the curve of creativity, as the handful of looks that social media prioritizes has resulted in people’s tastes becoming much less broad,” he says. The earth tones and brass fixtures of cottagecore, the somehow-still-trending modern farmhouse—such styles continue to be in demand.
Real estate agents say that these choices can also help unlock the potential of a property when buyers lack the vision to see it—and ultimately help seal the deal. “I was the seller agent of an apartment on the Upper East Side that needed a lot of work,” shares Robert Pini, a New York City real estate agent at Compass Real Estate. “I had it staged and selected beige for the walls. The space seemed lighter, and it went into contract within 20 days.”
Welcome to My Mercedes-Benz Penthouse: The Rise of Branded Properties
Buyers are looking for recognizable name-brand endorsement when shopping for luxury properties. According to Sotheby’s 2026 International Realty Luxury Outlook Report, interest in branded residences is growing both in the US and globally. Nowhere is this more visible than Miami, which ranks second globally in branded residences, trailing only Dubai. 888 Brickell by Dolce & Gabbana in Miami is only the latest fashion-branded property under construction, soon to join residences branded by Missoni, Fendi, and Armani/Casa. Luxury automotive brands including Porsche, Mercedes-Benz, and Aston Martin have also entered the residential market. “The branded property is here to stay,” says Cassidy. “In Miami, you won’t find a new luxury development that isn’t designed by a fashion brand, hotel chain, or starchitect.”
The trend has spread well beyond South Florida to New York, Los Angeles, Aspen, and the Hamptons. Along Manhattan’s High Line, projects by Bjarke Ingels Group, Thomas Heatherwick, and Zaha Hadid sit near developments from SOM, Foster + Partners, and Jean Nouvel. Interiors receive equal attention: Jean-Louis Deniot designed the Waldorf Astoria Residences interiors, while Robert A.M. Stern’s The Bellemont features interiors by Achille Salvagni.
“Luxury buyers are very savvy about architects and decorators,” says Pini. “Robert A.M. Stern, for instance, was one of those rare architects who became a brand.” In Los Angeles, where celebrity culture permeates every industry, boldface-name designers are regularly dropped in MLS listings.
The Hamptons House Gets a First Floor Master Suite—and a Wing for the Grandkids: Homeowners Embrace Aging in Place
America’s aging demographics are reshaping luxury residential priorities in ways that extend beyond accessibility features. With the 75-and-older population projected to increase 48% by 2034, affluent seniors are reconceiving their final residential chapters—not as downsizing exercises but as multi-decade, multigenerational planning. “If you look at how Americans are aging, they are choosing to stay in their homes,” says Sood. “For the ultra-luxury market, aging in place is going to be important.”
“Quality Time Left,” a notion that has been circulating in self-help circles for years (see AD PRO’s story on this trend), has influenced boomers to think about their real estate decisions through the lens of purchasing or building what could be the last house they’ll own. Many clients are prioritizing cross-generational enjoyment. “Mature buyers are increasingly prioritizing homes that can evolve with them over time, supporting independence while also accommodating adult children, grandchildren, or extended family,” says Philip White, president and CEO of Sotheby’s International Realty. “This often means flexible layouts, private guest suites, secondary living areas, and amenities that allow multiple generations to coexist comfortably.”
These decisions are also being made with generational wealth in mind. “Many older, wealthy buyers view their properties less as an investment for resale than an asset to be passed onto the next generation,” says Pini. In ultra-luxury markets, that often means buyers maintaining multiple residences configured for different seasonal and familial uses, a practice he calls “aging in places” (emphasis on the plural!).
When Your Dream Home Is in an “Extreme Fire Zone”: Climate Concerns Are Reshaping the Southern California Market
One year after the catastrophic Los Angeles wildfires, high-end clients across the country are looking for so-called “resilience-ready” homes designed to withstand climate instability, from fire to flooding. “In terms of sustainability features in homes, climate resilience is expected to be the biggest area of growth over the next five years,” says Sood.
In many markets, particularly in Southern California, the reality of climate change has proved a dealbreaker for prospective buyers, who’ve been stymied by insurance availability and the sobering mathematics of rebuilding costs. “Premiums have gotten incredibly high, fewer insurers are writing policies, and entire neighborhoods have become problem areas,” says Jed Weisman, an agent with Westside Estate Agency’s Beverly Hills office, who says he’s witnessed multiple deals collapse over insurance complications. “When there’s a sign outside your house that reads ‘Caution: Extreme Fire Zone,’ that’s no longer something anyone can ignore.”
The crisis has made swaths of Southern California—Malibu, Pacific Palisades, Brentwood, areas north of Sunset Boulevard, the Hollywood Hills—increasingly difficult to insure against wildfire risk. California’s FAIR Plan offers limited coverage, but as Weisman notes, some properties have become functionally uninsurable. He’s worked with buyers accepting policies covering only a fraction of their property’s value, or choosing to “self-insure”—a euphemism for assuming catastrophic personal risk.
This uncertainty has spawned a new consulting niche. Armin Missaghi, owner and founder of luxury construction and remodeling company LA Design Build, reports that buyers in high-value hillside and coastal areas now routinely hire independent project managers to conduct private due diligence beyond public reports or city disclosures. “It’s increasingly common for homeowners to evaluate slope stability, fire exposure, drainage, and long-term risk before moving forward,” he explains—a process that occurs alongside, and sometimes in tension with, developer and contractor assessments.
No Cold Plunge, No Deal: Wellness as Infrastructure, Not Extras
Wellness features top the list of luxury real estate trends of 2026—and they’re no longer considered upgrades. They’re mandatory. “Wellness has evolved into a core expectation in the luxury market,” says White. “Buyers are actively seeking homes that support physical and mental well-being through features like spa-quality bathrooms, hotel-style amenities, dedicated fitness or yoga spaces, cold plunges, advanced air and water filtration, and access to nature.”
Michael Altneu, vice president of global luxury at Coldwell Banker Real Estate, characterizes this as “living your best life luxury”—a post-pandemic prioritization he sees no sign of waning. Homeowners are investing in saunas, cold plunges, and pickleball courts for their primary residences rather than accessing them through club memberships or hotel stays.
Missaghi agrees. “Wellness is now baseline, not aspirational,” he says.
Is That Nice-Looking Room Real, or Is It AI?: Digital Staging Continues to Confuse
With the implementation of new state bill AB-723 in January 2026, California became the first state to outlaw the undisclosed use of digitally altered images in online real estate listings. The law arrives as artificial intelligence has made digital staging so easy and convincing-looking that doctored images are now almost impossible to distinguish from photographs.
While digital staging is often characterized as deceitful, there’s also an argument that the technology delivers benefits to buyers and sellers alike. Digital staging allows presenting renovation potential or alternative design schemes without physical investment, expanding possibilities for client visualization. Altneu points out that high-quality visual representations can help prospective buyers “better envision a property’s potential and lifestyle appeal.” The efficiency gains—and cost savings—have driven rapid adoption across the market.
The gap between rendering and reality has always existed in architecture and design; AI has simply made that gap easier to create and harder to detect. “It can be very misleading,” notes Weisman, who has watched AI-generated imagery proliferate across luxury listings. The legislation acknowledges what industry professionals already know: The boundary between representation and fabrication has become dangerously permeable, requiring regulatory intervention to protect buyers making million-dollar decisions based on manipulated images.
Despite AI’s expanding role in marketing and operations, Weisman maintains that certain elements remain irreplaceable: “You always want to have a human expert in your corner when you’re making one of your most significant financial decisions.” It’s a reminder that even as technology transforms visualization and marketing, the judgment, context, and accountability provided by experienced professionals retain fundamental value in high-stakes transactions—particularly when the images themselves can no longer be trusted.
Join the AD PRO Directory, our professional network that puts you in front of the right clients. Learn more
.png)
.jpg)
