Have London and New York Lost Their Status as the Best Cities for a Second Home?

London and New York have for decades been among the first choices for international buyers seeking luxury property, a safe place to preserve capital or a second home in a global business centre. They remain highly attractive today, but the international market trends monitored by Eurovilla show that buyers are no longer choosing a prestigious address at any cost.

High taxes, rising ownership costs and changing lifestyles are encouraging affluent buyers to consider a broader range of destinations. Cities such as Milan, Lisbon, Dubai and Miami are increasingly emerging as alternatives to traditional luxury markets.

Traditional centres still hold significant value

It would be an exaggeration to claim that London and New York have lost their importance. Both cities offer qualities that are difficult to find elsewhere in their entirety: a highly developed business environment, international schools, culture, world-class dining, excellent air connections and a liquid premium property market.

London continues to attract international professionals, families and investors, particularly buyers from the United States and the Middle East. Certain neighbourhoods, such as St John’s Wood, continue to record strong demand even when the wider London premium market is experiencing a weaker period.

New York also retains its position as one of the world's most important business and cultural centres. A property in Manhattan is not simply an investment for many buyers, but also a base for business, their children's education and time spent in the city.

However, prestige is no longer sufficient reason to buy if annual ownership costs are excessively high and the property is used for only a few weeks each year.

The cost of ownership is becoming more important than the purchase price

Luxury property buyers have traditionally been less price-sensitive. Today, even the wealthiest buyers are paying closer attention to taxes, service charges, management fees, insurance and maintenance costs.

In London, high property purchase taxes, changes in the tax treatment of international residents and weaker growth in premium property values have reduced interest among some foreign buyers. Values in certain parts of the prime market remain significantly below the peaks reached more than a decade ago.

Similar considerations apply in New York, where owners need to account not only for the purchase price but also for high building charges, property taxes and the specific rules imposed by individual buildings.

As a result, some buyers are no longer asking only how much a property costs to purchase, but how much it will cost them each year while they are not using it.

A second home needs to serve multiple purposes

In the past, it was often enough for a second property to serve as a luxurious place for occasional stays. Today, buyers expect considerably more from it.

They are looking for a space where they can work, spend extended periods with their family, host guests or professionally rent out the property when they are not using it. Security, easy maintenance, wellness facilities, privacy and the ability to manage the property remotely are increasingly important.

If an apartment in London or New York remains empty for most of the year while generating substantial ongoing costs, buyers may consider a market offering a better combination of lifestyle, tax environment and potential rental income.

This is precisely why interest in serviced and branded residences is growing, with professional operators taking responsibility for maintenance, security and part of the day-to-day management.

Why are Milan, Dubai and Miami attracting attention?

Milan attracts international buyers with its combination of European lifestyle, business importance, excellent transport connections and a more favourable tax environment for certain foreign residents. In recent years, the city has recorded strong growth in demand for luxury property, although rising prices mean that buyers there must also carefully assess the true value of each property.

Dubai remains attractive due to its new-build developments, well-developed market for branded residences, international community and relatively straightforward property management. According to the Knight Frank index, Middle Eastern markets, led by Dubai, were among the strongest performers in the global luxury property market during 2025.

In the United States, Miami is increasingly competing with New York. Buyers are attracted by the climate, Florida's tax advantages, growing business activity and the possibility of combining permanent residence, leisure and investment.

This does not mean that emerging centres will completely replace London or New York. More often, it reflects a broadening of property portfolios and a shift in priorities rather than a complete move away from traditional markets.

Where does Croatia fit into this picture?

Croatia cannot compete with London or New York in terms of market size, business infrastructure or global liquidity. However, it can offer something that a growing number of international buyers are specifically looking for today: safety, nature, a Mediterranean lifestyle and high-quality properties by the sea.

Premium villas, historic urban properties and contemporary developments on the Adriatic can appeal to buyers who want to genuinely use their second home rather than simply hold it as a status symbol.

The greatest opportunity for further development lies in creating high-quality property management services, additional amenities and projects that combine privacy with hotel-level comfort.

Prestige remains important, but it is no longer enough

London and New York have not lost their place among the world's leading property markets. What has changed is what buyers expect from a luxury property.

Alongside the address and potential for capital appreciation, buyers today assess taxes, annual ownership costs, ease of use and the quality of life a property provides. A city that successfully combines these elements can attract international buyers even without a long-established tradition as a global luxury property market.

Eurovilla provides clients with access to carefully selected properties in Croatia, as well as expert advice tailored to both domestic and international buyers. Contact us to find a property that combines a high-quality location with genuine long-term value and the lifestyle you are looking for.