The housing market in the United States is in an interesting situation right now. While most would suspect the economic grinder caused by the coronavirus would shut the market down, the exact opposite has happened. Housing is a booming industry right now, which means that there’s no better time to scour the market for a luxury home.
However, not all luxury houses are created equal, and many sneaky real estate agents will slip those two words in to attract buyers to a substandard property. So, how can you be sure that your luxury home is worth the hundreds of thousands, if not millions, that you spent for it? Here’s what you need to know.
First Things First: What Is a Luxury Property?
Before we dive deep into the signs that your luxury home is worth the investment, let’s define some terms. What is a luxury property?
The definition of a luxury home is one that sells at a value within the top ten percent of all local properties. Where this value tops and bottoms out depends entirely upon the local housing market. An area with reduced property values might have more modest luxe offerings compared to a multimillion-dollar subdivision.
Due to their highly valued features and exceptional locations, properties like these luxury condos are coveted by all and stand out compared to the surrounding homes.
What Features Often Appear in a Luxury Home?
So, you’re committed to buying a luxury home. Due to their high dollar amounts, you can all but count on some less than scrupulous real estate agents trying to sell you less home for more money. You need to know what features to look for to ensure that you’re not getting fleeced.
While these features by no means define a luxury home, they often appear in any property with “luxury” attached to its name. These signifiers of a true luxury house include, but are not limited to:
In real estate, there is one absolute, whether it’s for residential or commercial use. Everything, everything comes down to the three Ls: location, location, location. You can certainly buy a McMansion out in the middle of Podunk, Nowhere, USA. It might save you money, and would certainly give you some privacy.
However, if your goal is luxury and the envy of all, why would you do that? A luxury home usually rests very close to a major city, a coastline, or a gorgeous mountain range.
Prestige is a tricky thing to nail down. A house with a prestigious background could mean that it’s a historical mansion, a fixture of its local culture. Or, it could mean that it belonged to a celebrity in the past. While you shouldn’t necessarily part with more of your hard-earned cash for bragging rights, the ability to state that your home has a rich history is a nice touch.
Extensive Square Footage
You’ll never see the words “luxury home” next to a tiny square footage count. Both indoors and out, luxury properties are massive. They’re characterized by their enormous rooms, multiple stories, and sprawling grounds packed chock full of amenities. (More on those later.)
Actually, square footage is often the determining factor for whether a luxury condo qualifies for the name or not. And in an expensive city, you’ll pay rents in excess of four thousand dollars per month.
Gorgeous Custom Designs
If there’s one thing all luxury homes have in common, it’s that they have so little in common.
Confused? Well, unlike the cookie-cutter homes of the masses, luxury homes have awe-inspiring and unique designs. You won’t see a bog-standard in-ground rectangle for a pool. Nor will you see a single builder’s grade window or fixture. Every wall, every window, every cabinet, and every fixture has been specially selected and often custom-fitted for the home.
Whether it’s through their height, an off-the-wall balcony design, or some other custom feature, luxury homes command your attention with their uniqueness.
However, something any luxury property worth its salt will always have on hand is high-quality materials. You’re not going to see the same counters here that you would at a home improvement store. These floors are actual hardwood, not vinyl veneers. Countertops are true marble, not a faux mix.
All windows and doors will be the best the buyer could purchase at the time. This means that, for most modern luxury homes, their energy efficiency will be unparalleled.
When you think about amenities, you probably think about the options available at a hotel, not a luxury house. However, luxury homes are known for having an amazing array of amenities. There are a wide variety of amenities you can find within a luxury property.
Obvious choices include swimming pools and tennis courts. However, even hidden ones like full bars and libraries count towards the amenities a luxury house can offer.
Tips to Avoid Losing Your Investment
Now that you have an idea of what traits to look for to ensure your next home is worth your time and money, let’s talk more about the buying process. It’s time to learn how to buy a luxury home without losing your shirt in the process.
Luxury homes often cost hundreds of thousands, if not millions of dollars. You don’t want to lose that kind of investment in the garbage. So, here’s what you need to do to avoid losing your money:
Your Eyes Can Deceive You
They say that a picture is worth a thousand words. However, photos of a property can deceive you for good or for ill. Some pictures prove uniquely unflattering to a property’s strengths and character. That can make you dismiss what could have become your perfect luxury home.
Alternatively, the photos can look gorgeous and sell you the house. However, once you arrive, you notice massive issues that the photos either cleverly omitted or outright could not depict. It’s rather difficult for a photo to convey the ominous creaking your historic home does when the wind blows.
So, make sure you visit the property in person in order to get a better idea of how it really looks outside of pictures.
Work With Locals
Since the luxury home designation depends so much upon the local housing market’s prices, it behooves you to work with locals. Those who wish to part from their luxury properties might not want to show their house off to too many buyers, so if you can get in with them through a local, that can save a lot of time and effort.
Don’t rely on luxury homes to show up through traditional listings. Reach out to local real estate agents to see what other properties they can scrounge up.
Document, Document, Document
As with any high-dollar purchase, you must make sure to document everything. Due to the dollar amounts being exchanged, it’s natural for lenders to raise some eyebrows. So, make sure that you have full documentation of your income prepared during the buying process.
It’s also important to document any potential flaws you see with the home during the showings and closing meetings. If you can track these issues and prove that you didn’t cause them to the real estate agent or the insurance company, it can save you a massive headache and loads of extra repair bills.
Look Towards Resale
You might not want to keep this coastal luxury home forever, especially if sea levels start rising. So, when buying a luxury home, make sure to keep a weather eye on its eventual resale value. You never know when it might be time to cut your losses and move elsewhere.
Partner With the Right Lender
Not every real estate agent knows how to work with such large amounts of money. Nor does every mortgage financier know what to do when the dollar amounts enter six digits. That’s why it’s crucial to find someone with integrity and experience above all else.
Don’t Let Your Eyes Grow Bigger Than Your Wallet
Look, just because you can afford the mortgage on a home worth over three million dollars doesn’t mean that you should buy that house. You need to make sure to plan for a disaster to strike, and have somewhere that you can live comfortably without risking bankruptcy if something goes wrong.
Countless people have let money and status get to their heads and blown it all on fancy symbols like these luxury homes. Don’t become one of those statistics.
Let’s Review How to Find the Luxe Home of Your Dreams
If you want to buy a luxury home, you need to have a keen eye for extravagance, finance, and details. You must be able to identify the attributes that add value versus those that don’t. You must also know the buying process inside and out to ensure that you partner with the right real estate agent.
However, in the end, as long as you know what to look for, you’re sure to find the luxe home you’ve always dreamed of. And if you need more help tracking down that perfect place, check out our blog for more helpful articles like this one.