In a frozen luxury housing market, buyers are asking to ‘try before you buy’ and having sleepovers in multimillion-dollar mansions

The frozen luxury housing market

Sydney Lake is an associate editor at Fortune, where she writes and edits news for the publication's global news desk.

In today’s luxury housing market, it’s become increasingly difficult to sell for what the homeowner might think the home is worth—and even high-profile sellers have been forced to drop prices on their megamansions. 

Because home prices and mortgage rates remain elevated, buyers are scrutinizing their purchases now more than ever. Plus, in several luxury housing markets, extra “mansion taxes” are tacked on, making purchasing costs even more expensive. 

So to woo prospective buyers, sellers are trying a new tactic: offering up sleepovers in their mansions to help seal the deal. 

Julian Johnston, a real estate agent with The Corcoran Group in Miami, said this is a trend he’s seeing more frequently in today’s luxury market as sellers and agents are forced to become more open to creative strategies like pricing adjustments and unique marketing campaigns to stand out. 

“In the luxury sector, where buyers often have the means and the time to wait for the right property, anything that sparks fresh attention and differentiates a home from its competition can help move the market forward,” Johnston told Fortune. 

The Wall Street Journal first reported about this trend earlier this week, offering the example of a $60 million mansion where the owner allowed an overseas couple to stay at the home for two months at $250,000 per month before putting in an offer. Eric Albert, the homeowner, told WSJ the potential buyers wanted to be sure the home was comfortable for them and make sure it was a good size and layout for them.

“For $60 million, you should try it before you buy it,” Albert told WSJ. “It’s a smart thing to do.”

While Johnston told Fortune he’s not seeing it with the majority of listings yet, “it’s certainly gaining traction in high-end markets where buyers are more selective.”

Other real estate experts, however, see this as potentially a move of desperation for sellers—and a signal some luxury homes are overpriced at the start. 

“Sleeping in the house to get a feel for it is one of the oddest concepts I’ve ever heard of,” Simon Isaacs, founder of Palm Beach, Fla.-based luxury firm Simon Isaacs Real Estate, told Fortune. “That doesn’t mean it won’t happen. Stranger things have happened.”

During the past couple of years, there have been several notable cases of high-profile people being forced to drop the price on their lavish luxury homes. In April 2024, billionaire media mogul Rupert Murdoch majorly slashed the price of his Manhattan penthouse

Then this May, Jennifer Lopez and Ben Affleck slashed the price of their $60 million Beverly Hills megamansion

These few examples go to show that while not fully out of a seller’s market, the tides are turning in favor of buyers as listings stay on the market longer and price cuts become more common, according to Realtor.com.

“Square footage and celebrity status don’t justify inflated pricing anymore,” Anthony Luna, CEO of LA-based real-estate advisory Coastline Equity, told Fortune. “Buyers want smart design, upgraded systems, and long-term value.”

Meanwhile, luxury buyers and sellers also have to contend with mansion taxes in some markets. The mansion tax in LA, for example, applies an additional 4% tax to property sales of at least $5 million and a 5.5% tax for properties north of $10 million, further complicating real-estate sales and pricing. 

The tax, which is typically paid

One of the more recent examples of municipalities considering mansion taxes is Cape Cod. Already one of the most expensive housing markets in the U.S. where homes often exceed $1 million, according to Warren Buffett’s Berkshire Hathaway Home Services, it’s about to get more expensive for luxury homeowners. Cape Cod lawmakers are considering a tax on wealthy homeowners that would tack on an extra 2% surcharge on luxury-home sales above $2 million.

Considering those factors, luxury homeowners will have to be more mindful than ever when pricing their properties. 

The reason there are so many price drops in the luxury sector is “they were mispriced in the first place,” Issacs said. 

“Everybody has an expectation of what their home is worth, and real estate brokers who are on the ground showing people every day have a better understanding of what people want, what people’s appetite is, and what things are spent on,” he said. “Some things they’re willing to spend [on], and some things they’re not.”