Buying something like a luxury house moves much more than just dollars in your bank account. With extraordinary real estate and even houses available for sale at a premium rate, buying luxury homes might be fun. But it also has some risks.
According to estimates, the luxury market was estimated to be around 276.5 billion dollars in the year 2024, and it is predicted to touch 472 billion dollars by the year 2032.
What this basically means is that the market has a CAGR of 6.9%. There is a transparent market for luxury homes, given the trends.
Because of the investment risk, partnering with an agent who has experience in the luxury market helps. These are especially helpful in many cases, as we will see in this article. Keep reading!.
Expertise in Navigating Complex Markets
There are different regulations, practices, and expectations for luxury real estate compared to other markets.
A luxury home is not just a bigger home but also comes with unique designs, better places, and other highlighting features. The market is also more volatile due to economic changes and buyer preferences.
For example, due to high demand, luxurious homes started selling for around $1500 per square foot worldwide by 2023. Also, by 2017, the selling season for a luxury Meridian estate had dropped to 190 days, down from 254 days in 2014.
In such challenging interior markets, having a good luxury real estate agent can help prospective buyers immensely.Brady Bridges, broker and owner at Fort Worth based real estate agency Reside Real Estate, explains:
“Navigating the luxury market requires an in-depth understanding of unique client needs and market dynamics. A great agent not only connects buyers with properties but also ensures the entire experience is seamless and rewarding.”
This expertise proves vital in many ways:
- Property Valuation:
Most luxury homes are one of a kind, which makes it difficult to estimate their selling price. However, a real estate agent ensures the property value is represented accurately. Also, they customized the price to suit the buyer’s budget.
- Market Trends:
Global scenes and political climates influence the luxury market. A professional salesperson can only understand such disturbances, which is why they are needed.
- Exclusive Listings:
Many luxury residences or homes are never advertised, nor do they ever appear on the listings. A competent agent has the opportunity to improve these elite properties, improving aid buyers.
- Neighborhood Knowledge:
It’s not just about price but also about location, lifestyle, and future construction that a luxury real estate agent knows. They may provide some useful information regarding schools’ location and amenities as well as local initiatives.
- Potential Return on Investment:
High-end properties are also valuable assets. An agent helps buyers make advantageous investment decisions by evaluating factors that contribute to price increases.
- Off-Market Opportunities:
In most cases, high-end properties are sold privately, as opposed to the traditional method of advertising. An experienced agent would link the buyer to the seller of the property, who would have needed to consider placing the advertisement,
Negotiation Skills to Protect Your Investment
In reality, buying a luxury home is more complex than it seems. For someone looking to buy their first luxury home without any real estate experience, the process can seem complicated.
A skilled agent can ease the burden, making the process much easier. Agents are just one part of the equation. Alongside them, buyers, sellers, lawyers, etc., are crucial stakeholders in this process.
Even having an agent on your side makes it easier to let go of the tension and close the deal.
“Success in real estate comes down to two factors: taking care of and valuing the customer.” — says Michael Miedler, CEO of Century 21 Real Estate.
Since agents have vast experience in negotiating home prices, they are well suited for the task. A common misconception is that luxury homes cannot change their price. However, a professional agent is still able to secure a price cut.
If you’re paying more than 10% of the asking price, experts suggest that you might be able to reduce the final price further.
Lastly, ensure that all parts of the contract are complete, including repair credits and financing clauses. The need for a good agent becomes clear at this point.
As it becomes their responsibility to protect the buyer’s interests while also providing them with listings suited to their needs.
Saving Time and Reducing Stress
Buying a luxury home involves several activities, such as locating suitable listings, arranging viewings, arranging financing, and engaging legal counsel. This can be a lot for a busy client.
In that case, a high-end real estate agent can ease the burden of all the above-mentioned tasks and many more. They know where the properties are and who is willing to sell them off the market.
They also handle things such as showing the house for sale and inspecting it before signing the contract.
According to Zillow, 88% of prospective buyers use real estate agents, whereas in the luxury segment, more buyers use agents. Buyers spend less time with agents and concentrate on what matters most to them.
Here are Some of the time-saving benefits of working with a high-end real estate agent:
Agents have exclusive access to homes that aren’t available for sale.
Saving you time by finding houses that match your expectations.
It’s easy to schedule viewings and inspections because agents handle everything.
Prepare legal documents to assure accuracy.
Real estate agents assist in financing by linking you up to suitable lenders.
Experts in the surrounding area can help you pick the right place.
Since agents save clients time and money, commissions are worth it.
Manage all correspondence so there is less hassle.
Market Trends and Future Value Analysis
Working with a luxury real estate agent provides clients with working knowledge about market trends and future value, among other benefits. There is constant change in the luxury sector caused by economic factors, consumer needs, and technology.
As remote working opportunities increase, many affluent individuals are looking for houses with larger offices, bigger houses, and enough space to separate work from personal life.
This trend has significantly increased demand in locations that offer a higher quality of life, such as coastal and rural areas.
Now, the demand for luxury real estate has become global. Buyers from various countries within USA, particularly Miami, New York, and Los Angeles, are buying U.S properties.
U.S.A. real estate is a classic and profitable business investment strategy that encourages this trend.
According to Forbes Global Property’s list of 200 luxury property experts, 60% of them believe that economic concerns will determine their respective markets in 2023, alongside stockouts and political issues.
They help you purchase or sell a house regardless of the process. Reside is the self-proclaimed ‘laid-back’ neighborhood real estate agency that treats you like their only client.
No matter if it’s your first home purchase or you’re an experienced investor, they will be by your side. Besides real estate, they also offer marketing strategies, mortgages, and staging. Their goal is to reduce client stress by clearly taking care of all interactions.
So, undoubtedly, they are the best, and you can choose them without any hesitation.
Last Say
Although the market is broad, luxury real estate can be soft with the right agent on your side; plus, there are many benefits.
They have experience in managing complex details such as understanding the market, negotiation, and their insights, enabling them to manage any complexities.
However, It is essential to work with a knowledgeable real estate agent, particularly as the luxury market evolves. New buyers entering the exclusive market will benefit from teaming up with an expert with extensive local market knowledge.
