Luxury real estate in 2024 paints a mixed picture globally, with the EU and US facing headwinds, while markets like Mauritius entrenched their position as resilient and attractive destinations for high-net-worth individuals (HNWIs). In 2025, Mauritius will continue to offer worthwhile investment opportunities, balancing lifestyle allure with financial incentives.
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Luxury real estate – 2024 in review
United States
In the US, the luxury real estate sector recalibrated in 2024. Rising interest rates and economic uncertainty dampened buyer enthusiasm, particularly in urban luxury hubs like New York and Los Angeles. A pivot toward suburban and secondary markets became evident, with affluent buyers seeking more space, privacy, and value for their investment. The remote work trend further fueled this shift, as buyers prioritized estate-style homes in regions like Austin, Texas, and Boulder, Colorado, over penthouses in the traditional urban cores.
Sustainability also emerged as a central theme, with buyers increasingly demanding energy-efficient homes that align with ESG (environmental, social, and governance) principles. However, this demand was tempered by cost barriers, as developers struggled to deliver green features without significantly inflating prices.
According to Inman’s 2025 economic outlook, “a soft landing for the economy would mean home prices keep rising and mortgage rates settle in at around 6%, with sales varying widely by region.” (Inman is regarded as the industry’s leading source of real estate information in the US.)
European Union
In the EU, the luxury market grappled with an overlapping government energy crisis and stringent regulations to curb carbon footprints. Key cities like Paris, London, and Berlin saw softer demand due to increased taxes on high-value properties and limited foreign investment activity.
Yet, the EU luxury real estate market didn’t entirely lose its shine. Southern European countries like Portugal, Italy, and Greece gained traction with their golden visa programs and relatively affordable luxury properties. These destinations appeal to retirees, digital nomads, and investors seeking sun-soaked locales with cultural wealth.
According to UK property site Rightmove, average asking prices are expected to rise 4% by the end of 2025 – an uptick in recent years but in line with the long-term average.
Knight Frank analysts note that the European real estate market is rebounding, driven by declining interest rates and steadier valuations, fostering a more investment-friendly climate.
Looking ahead to 2025, the European Central Bank (ECB) is expected to provide additional monetary easing, though its trajectory will hinge on inflation trends, economic growth, and global policy developments. Elevated inflation within the Eurozone and possible protectionist measures in the US may temper the anticipated rate adjustments.
Mauritius: resilience amid global challenges
While the US and EU contended with economic headwinds, Mauritius challenged global trends by positioning itself as a haven for luxury real estate investment. The island’s appeal lies in its pristine natural beauty, high-quality infrastructure, and investor-friendly policies. The government’s progressive approach to encouraging foreign ownership through property schemes, such as the Property Development Scheme (PDS), played a pivotal role in maintaining market vibrancy.
Why Mauritius? A comparative edge
Favourable tax policies: Mauritius offers significant tax advantages that attract HNWIs from across the globe. With no capital gains tax, low property transaction costs, and favourable double taxation treaties, the island outperforms the EU and the US regarding financial appeal.
Residency incentives: Buyers investing USD 375,000 or more in qualifying properties gain residency rights in Mauritius, a feature that has become a significant draw for retirees, expatriates, and global investors. In contrast, the US EB-5 visa program requires significantly larger investments, while EU golden visa programs face tightening restrictions.
Lifestyle and security: The Mauritian lifestyle is often described as “luxurious simplicity,” combining laid-back island living with world-class amenities. The country is also politically stable and ranks high in safety, making it an attractive choice for families and retirees.
Unique investment opportunities: Mauritius integrates its luxury real estate offerings with resort-style living unlike the EU and the US. The availability of beachfront villas, golf estates, and exclusive gated communities appeals to buyers seeking an all-encompassing lifestyle.
2025: What lies ahead for Mauritius
In 2025, Mauritius is poised to strengthen its global luxury real estate market position. Several factors suggest continued growth:
Geopolitical drivers: Global political and economic uncertainties will likely push investors toward safe and stable destinations. Mauritius, with its robust legal framework and thriving economy, is set to benefit from this trend.
Increased demand for wellness and sustainability: The demand for wellness-centered living is expected to shape the luxury market in Mauritius. Developers are already responding with properties featuring yoga pavilions, spa facilities, and eco-friendly designs.
Digital nomad and remote work boom: Mauritius’ popularity among digital nomads and remote workers is expected to rise further, bolstered by its reliable connectivity, favourable time zone, and attractive taxation policies. Properties catering to this demographic could see a spike in demand.
Enhanced infrastructure: Government-led infrastructure projects, including smart city developments and improvements in transport networks, will further enhance Mauritius’ investment appeal. These initiatives create new pockets of luxury real estate, from eco-conscious smart towns to high-end marina developments.
Competition and value appreciation: Limited supply in prime locations could lead to significant value appreciation as demand grows, making Mauritius an attractive choice for short-term gains and long-term wealth preservation.
Mauritius government support of the real estate sector
The Mauritius National Budget for 2024/2025, presented by Dr. the Honorable Renganaden Padayachy, Minister of Finance, Economic Planning and Development, introduces several measures impacting the real estate sector:
Promotion of foreign investment in real estate: Foreign entities can now hold immovable property for industrial or commercial purposes through non-renewable leases of up to 30 years.
Homeownership incentives: The Home Ownership Scheme and Home Loan Payment Scheme, offering a 5% refund on property purchases and housing loans up to MUR 500,000, have been extended until June 30, 2025.
Sustainable development requirements: New fragmentation projects must allocate at least 4% of the total land area to green forests composed of endemic trees. Additionally, a minimum setback of 30 meters from existing settlements is mandatory.
These initiatives aim to stimulate investment, promote sustainable development, and enhance the attractiveness of Mauritius’s real estate market.
Luxury real estate in 2024 showcased a world of contrasts. While the US and EU markets faced notable challenges, Mauritius emerged as a beacon of opportunity, offering a compelling mix of lifestyle, stability, and financial benefits. Looking ahead to 2025, Mauritius is set to thrive, aligning its offerings with global trends and solidifying its status as a sought-after destination for luxury living and investment. Investors seeking a blend of tropical paradise and sound returns will find Mauritius uniquely positioned to deliver.
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