6 STEPS TO BUYING A LUXURY PROPERTY
I’m going to share with you some of the differentiation that is involved when looking to purchase a luxury property and what that looks like compared to buying a regular or starter home and there are several steps that you’re going to want to consider.
The first thing that I want to offer you to establish is a great search process. You want to define how it is that you’re going to find these types of the property oftentimes, they’re not even on the market. They may be pocket-listed. So making sure that you have MLS access and internet-based access and access to the private network of properties through a variety of sources and those sources we will get into in a sec. Hence, the search process is number one.
Number two is making sure that you’re finding the right set of reliable photos, oftentimes with a luxury property; it’s not just one building. It might be several it might be estates there might be grounds involved there might be amenities that are difficult to photograph a helicopter pad a vineyard, a multi-car garage all of these things will require a different lens with which to look so the more photography that we get access to the better a lot of times with luxury property there won’t be as many photos based on privacy and will want that access to upfront to make sure that this home will match the needs that you are looking for so that is step number two.
Step number three that we want to find is making sure that we have the right documentation types. There’s a standardized purchase agreement that we can use. Still, all of the upgrades that could happen with a property if there’s work that has been done recently on renovations or additions or new buildings will want to track that there is appropriate permitting involved. All of the other crossings of T’s and dotting of eyes that will be handled in a typical real estate transaction and the requirements I’m saying luxury luxurious and much larger than will be point number three.
As we touched on earlier, point number four is going to be finding the right team and the right advisors with luxury property. There’s a complexity that doesn’t exist in traditional transactions. So there can be a real estate agent that will also work exclusively with a family office, a financial planner, a corporate attorney, a family trust. Several things can be involved, and so having the right team in place and having them all know and work together well Kiri itself in spades and make the transaction that much smoother.
The next step we’ll move on then at this point to look to the future knows that in buying a luxury property, oftentimes it won’t just be appraised like a standard home because there’s not inventory like it. It really can be like a snowflake and extremely unique, and so you’ll want to take advantage of trying to find this concept of looking into the future and making sure that that asset will continue to gain value and that there are other like-kind comparables in some way or another to be able to work off.
Last but not least is knowing that this property is a snowflake will take us into our last step, which will often be there is room to negotiate. I have found that properties will be listed for 30, 40, or 50 million that might sell for 10 or 20 plus percent lower than the asking price or even more. This is millions of dollars of discounting that can be done in the way that is through effective negotiating, which is much different than a typical transaction.
There are several other tips and trends that we can share with the luxury property, but at least wanted to give you a start to know some of the differences and, as always, as a resource, if you are looking to buy or sell a home. You’d like to find out what your home is worth, or you’d like to find out what else is on the market, please do click on our links below.
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Erik Brown
Realtor/ Broker (BRE: 01958545)
Beverly Hills: 424-239-6519
Minneapolis: 612-294-0447
