The luxury real estate market is different from the standard real estate market in some subtle but important ways. If you plan to make a luxury home purchase in the near future, you should consider these important facts about the market today and how you can benefit from it.
1: The Luxury Market is Usually Favorable
Even when the real estate market as a whole takes a downturn, the luxury housing market doesn’t feel as many adverse effects. This is partly because the market is geared toward middle-income Americans, who are in a different financial bracket than the people who buy luxury homes. This means that even if you sell your current home for lower than you wanted to, you might still be able to stay within your budget by making a good offer on a luxury home and getting it for less than you expected.
2: There is Still Competition at this Level
When entering the luxury market, some people think they won’t have to worry about bidding wars or multiple offers on a home. The fact of the matter is that a desirable home will almost always get multiple offers. You should go into negotiations under the assumption that you might have competition for the house. You should also realize that many luxury homeowners have a certain price level in mind and will stick to what they think the house is worse. This doesn’t mean you should panic and make a ridiculous offer, though. Just realize that you might need patience and tact in the negotiation process.
3: Title Clarity can be a Problem
A lot of homebuyers overlook the details of their title, figuring that the ownership of the home itself is what they care about the most. In fact, if your title isn’t completely clear you might find yourself running into some issues with your home down the road. You need to make sure to examine all details of your title to determine things like water rights, confused boundaries, and possible historical value. Be sure to hold off signing if you don’t have 100% clarity on these essential areas.
4: Green Choices can Save you Money in the Future
Does your potential new luxury home have a skylight? Are the windows modern and fully weatherized? What sort of heating system do you use? The energy efficiency and carbon footprint of your home is worth looking into even if you wouldn’t normally have those things high up on your list of priorities. The government regularly gives credit on green items, and the energy savings can help offset a higher purchase price for a home. If the house’s cost is a little higher than you want to go but has a number of energy-saving features, you might still want to consider making the purchase.
Some of these tips apply to standard real estate, but their importance becomes magnified when you enter the luxury home market. With a little knowledge ahead of time, you can make sure you get a great deal on a new luxury home.