The price of luxury rents in Trump’s home town fell 6.7 percent per-square-foot between December and March of 2017. And that’s no seasonal trend: prices rose in the first quarter of both the preceding years.

“Nobody is drinking the Kool Aid anymore,” Darren Sukenik, broker at Douglas Elliman, said in an interview. “When it was go-go times and people were just throwing money around, people bought into that dream,” he said, adding that the slowdown was most acute in the market for homes above $20 million, which is sustained by speculative buyers.

Fine Art

The record-setting $110.5 million sale of a Jean-Michel Basquiat at a Sotheby’s auction last week is one sign that after a difficult year, parts of the art market may be flouting the trend evident elsewhere in luxury. The untitled Basquiat canvas set a record for American artists at auction, and led a week that saw auction houses accrue an unexpectedly sturdy $1.6 billion in sales, according to artnet.


Art sales tumbled 14 percent last year, the main reason behind Knight Frank’s luxury investment index posting its weakest performance since 2009, according to the firm’s 2017 wealth report.

Returns for the asset class come down to what kind of art one is investing in, argues the editor of Knight Frank’s report, Andrew Shirley. That’s shown in the stratospheric returns on the Basquiat -- which was bought for $19,000 just over 30 years ago.

"Across most sectors of the luxury-investment universe buyers are becoming more circumspect about paying over the odds for their acquisitions, and art is no exception," said Shirley in an interview. "For example, the performance of Old Masters has been quite muted for several years now, with contemporary art more in vogue," he said.

One place luxury is outperforming? The stock market, where a Bloomberg Intelligence-devised basket of companies that includes Samsonite International SA, Burberry Group Plc and LVMH has, over the first five months of 2017, exceeded broader equity-market returns.

This article was provided by Bloomberg News.

 

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