Luxury Real Estate Isn't Slowing Down, It's Scaling Up

Forbes

18-07-2025

It's the infinity pools that are defying gravity, as well as the real estate market.
Things are getting hot in Florida, everywhere else except real estate that is.
In fact, most of the state's housing markets are in serious trouble, flashing red alert signs across key indicators. Florida dominates the list of America's most distressed housing markets, facing a toxic cocktail of oversupply, climate risk, and rising insurance premiums that have made even enthusiastic buyers hesitant to commit.
Redfin estimates that sellers now outnumber buyers by 500,000 across the U.S., and in no place is that imbalance more acute than Miami, where listings outpace interest by nearly 200%. By the traditional laws of economics, one would expect prices to plummet and construction to stall. Despite the bearish mood, median home prices in Miami have crept up by 5.6%. More puzzling still: some developers argue that the real estate market is doing better than ever, at least when it comes to the luxury end of the market.
At the center of this all is Gil Dezer, who is capitalizing big on a new kind of high-end development: branded living spaces that fuse concierge-style services with aspirational design and, yes, car elevators.
The fact that Dezer is making the market work while others are exiting it speaks to a series of deeper trends about the economy, the productivity gap in real estate as well as how brand-led growth is taking over the industry.
Making Sense of the Current Housing Market
Today's real estate market is buckling under pressure that is mounting from every side imaginable.
Mortgage rates, while not historically extreme, are more than double what most homeowners grew used to during the long era of near-zero interest, a shift that's been psychologically jarring, not just financially burdensome. The excess inventory hasn't yet triggered the broad corrections one might expect, and behavioral economics offers part of the reason why. Houses aren't your typical asset class. Instead, they're identity assets.
For most owners, taking a loss on a home carries emotional weight that far exceeds what standard models of loss aversion predict. Selling at a loss doesn't just dent the balance sheet, it dents the self. Unless pushed by absolute necessity, people would rather hold on than accept that loss. And then there's the double-bind that's unique to housing where each seller is usually also a buyer.
That circularity means pricing expectations adjust in ways where many are willing to accept inflated prices because they know they'll be paying them too. Even with all these rationalizations in mind, the underlying fact remains. The U.S. housing market is broken, stuck in a prolonged slump it has yet to recover from, despite what the experts keep predicting.
In Florida, the situation is even more volatile, not least because the local insurance crisis, exacerbated by the Surfside condo collapse and increasing climate risk, has led to eye-popping premiums.
'Real estate is hyperlocal,' says Michael Holt, at Compass. 'Miami's definitely softening, but if you go up to New York City, we've seen nine consecutive months of consecutive growth and pending sales are up 26 percent. The pendulum always swings, but it's swinging differently in different zip codes.'
Some of that movement is being driven by forced sellers. 'There are people who bought at the peak and are now selling at real losses,' Holt says. 'It goes against every instinct most homeowners have, but in this market, some don't have a choice.'
That's part of what makes Miami's luxury construction boom so striking. While many mid-market sellers are under pressure, ultra-high-net-worth buyers appear to operate on an entirely different playing field.
'Luxury buyers are rarely leveraged the same way,' Holt explains. 'They're not as sensitive to interest rates, and they're often buying in cash. Their motivations are more about lifestyle, long-term investment, even legacy, so the pricing psychology is just completely different.'
As Holt puts it: 'What looks irrational to most of the market makes perfect sense at the very top. The comps matter less than confidence and cachet.'
It is this psychology of real estate that also fuels Gil Dezer's cranes overshadowing Dumfoundling Bay.
The Rise of Branded Luxury Living
Gil Dezer is no stranger to high-end ambition. In fact, he's as close as one gets to having it run in his blood, given the family business.
After joining his father's development business in 2000, he helped bring six Trump-branded buildings to life by 2010. Then came the Porsche Design Tower, where residents can drive their cars straight into their sky-high apartments. It was a wild idea many dismissed, until it sold out.
'We only need 200 buyers to see things our way,' Dezer explains. 'That's the reality. We're not selling to everyone, just to the right people.'
The Bentley Residences, slated to be Miami's most premium tower, follows the same formula. Units start at $7.5 million and come with features like private pools, saunas, and, of course, car elevators. Half of them have already sold, with buyers putting down 50% deposits years before completion.
'These are real buyers. They love the product. And once they experience it, they stay,' Dezer says.
The luxury market, as Dezer knows intimately, doesn't obey the same rules of economics as the rest of the housing sector. It's its own gravitational field, where scarcity, identity, and perception drive value just as much as fundamentals do.
'In this segment, higher prices can create more demand,' Dezer says. 'People want to know they're buying into something exclusive, something truly best-in-class. You don't sell a Bentley by offering a discount.'
That's why every detail in the Bentley Residences is engineered for differentiation. 'Our buyers expect quality on every front, materials, privacy, technology, you name it. You can't cut corners when someone's spending eight figures. They notice.'
But delivering that level of precision under current conditions isn't easy, even when the demand is there. The same supply side pressures are squeezing high-end construction as well.
'Nothing about this is easy,' Dezer admits. 'Just because you have buyers doesn't mean you can build without pain. Insurance has gotten absolutely insane. For the Armani building, we paid $8.5 million. For Bentley, it's $42 million. That's before you even pour concrete.'
And unlike other luxury goods, where price tags can scale freely, real estate still comes with hard constraints. 'I can only sell for so much per square foot,' he says. 'There's a ceiling to what even the best buyer will pay, and meanwhile, our costs keep climbing. Plumbers used to cost $20 an hour. Now it's $40. Interest rates, materials, insurance, they all eat into your margin.'
In other words, even up in the stratosphere, gravity still applies. And construction has been held back by it more than many other industries.
Changing Construction Today: The Mystery of The Missing Productivity
For decades, economists and policymakers have puzzled over one persistent anomaly: while technology has turbocharged productivity across manufacturing, finance, and logistics, construction has barely moved. A 2017 McKinsey report famously highlighted that global labor productivity in construction grew at just 1% annually over two decades compared to 3.6% in manufacturing and 2.8% across the global economy.
In short, the way we build today needs to evolve.
'The solutions are complex,' says George Pfeffer, CEO of DPR Construction, a self-performing commercial contractor and technical builder known for its work on hospitals, data centers, pharmaceutical manufacturing facilities and more. Pfeffer cites a long-standing shortage of skilled labor and the customized nature of building as two factors contributing to that complexity. 'Commercial construction has some different factors at play compared with residential, but where both share common ground is in the idea that for true change to occur, we need to think long-term.'
Pfeffer notes that trust, safety, and human capital still drive performance more than algorithms. 'You can't be a contractor without having hope,' he says. 'The work is complex, the workforce is stretched, and the expectations are high, but we keep climbing.'
The generational talent gap is one area where DPR is driving change. 'We're working to change perceptions and reinforce the idea that construction is a meaningful, exciting career,' Pfeffer adds. 'We're building programs, mentorship pipelines, hands-on workshops. But it takes time.' To that end, the company has also focused on internships for high school students, career fairs, and classroom time with kids as young as third grade to inspire future generations about the opportunities available to them in construction.
And while Pfeffer and others are working on solutions, supply chain challenges continue to add complexity, for both commercial and residential construction.
Even developers like Dezer, with deep experience and strong demand, are finding it harder than ever to execute. The design might be modern and the clientele might be global, but the tools and workflows are often stuck in the past.
The productivity gap is real, and bridging it will require long-term solutions, not short-term fixes.
Building Through the Bottleneck: The Rise of Hyper-Personalization
With cost structures ballooning and traditional productivity tools offering diminishing returns, one of the most consistent strategies forward has been to climb the value chain. If you can't build cheaper or faster, you build smarter, rarer, and more personal. This is how we arrive at the dual rise of hyper-personalization and what some are calling the 'luxurification' of the built environment as evidenced by Dezer and many others.
'Technology is just a tool. What really matters is how you use it to put people first,' says Scott LaMont, of EDSA, a leading landscape architecture and planning firm.
'The industry is built around cooperation and connection. The isolation of the pandemic didn't kill that, it clarified just how essential it is, and we're seeing the market react to this in many different ways both on the supply and demand side,' he continues.
At EDSA, LaMont has embraced digital collaboration, generative design, and AI tools, but not in pursuit of raw efficiency alone. Instead, he sees these as enablers for more human-centered environments. 'We're flexible in ways we couldn't even imagine five years ago,' he says. 'What's exciting now is that we can scale individuality. We're building spaces that feel custom, not just at the penthouse level, but across entire communities.'
That theme, personalization at scale, is echoed even further down the supply chain.
'We build a SKU every six minutes,' says Jeremy Barker, CEO of Murphy Door, the industry leader in hidden doors and space-optimization features. 'Everything is custom. Everything is pre-paid. We don't warehouse what we make, we respond to who our customer is.'
Barker explains that his business has exploded after he joined a sales training program, and he credits the success to how he marries old-school craftsmanship with new-school responsiveness. 'We've got more full-stack engineers than we do traditional engineers,' he says. 'We don't sell closet doors anymore, we sell a part of our customer's identity.'
Murphy Door's meteoric growth, 117% year over year and counting, suggests this pivot toward lifestyle-forward construction isn't a fluke either.
'People want more than shelter,' Barker says. 'They want to feel smart, seen, and in control of their space. That's the future.'
Luxury, then, becomes less about opulence and more about intentionality. From Jeremy Barker's Murphy Doors to Gil Dezer's Bentley elevators, every detail becomes a design choice with meaning.
And for builders facing the headwinds of low productivity and rising costs, hyper-personalization becomes a survival strategy which turns friction into value, and constraints into craft.
For Dezer, that craft is embedded in the brands he works with. When buyers see the Bentley name, they aren't just buying a floorplan, they're buying into an identity. 'It's personal,' he says. 'These aren't just buildings where our customers happen to live. They reflect who they are, and in turn, who those behind the buildings are.'
We're seeing this survival strategy in action in places like downtown Miami where the buyers are still buying. In suburban Florida, markets are sliding. But lumping all of housing into a single trend misses the nuance.
As Michael Holt puts it: 'The client is the bellwether. If you know what they want, and deliver it with speed and clarity, you win.'
And in Miami, what clients want is a brand, a view, and a car elevator that takes them all the way home.