Work with an Agent Experienced in the Luxury Market
When purchasing a luxury home, you want to work with an agent who has experience in selling luxury homes and helping buyers in this market. They will have connections other agents don’t have, which will help you find your dream home in the ideal location. They can advise you on properties with increasing value and steer you away from those that have a lowering valuation. Because they are local, they will be more informed about planned changes to the area that might affect your purchase of a luxury home or your enjoyment of it after the purchase. The right agent will know about the properties no one else is aware of, giving you an advantage when you decide to buy.
How to Find and Buy a Luxury Home
Many inexperienced buyers in the luxury market expect to search for and buy a luxury home in the same way they would a traditional home. However, they are often at a disadvantage if they don’t know what to expect. Locating a luxury home in your desired area may be a bit of a challenge because they aren’t usually listed on MLS or through search engines. You probably won’t find them on Zillow or Trulia, and those you do locate may not come with photos or information to protect the seller’s privacy.
Financing is another area that differs for buyers searching in the luxury real estate market. It often takes longer to go through the loan process, and you may not be allowed to see certain properties until you are approved for a loan. The following power point presentation explains the best steps in finding and buying a luxury home.
3 Tips to Help You Buy the Right Luxury Home
Buying a luxury home is a lot different from purchasing a traditional home. From finding the home to financing it, you should expect the process to take a lot more time and be much more involved. Here are 3 tips to help you be prepared.
1. Start the search process the right way.
Contact a real estate agent with experience in the luxury market to find out about current homes for sale. Plan to go see any you might be interested in because you won’t find a lot of photos and information online. Do a search on Google Earth to see what surrounds the property and to give a you a good feel for the location.
2. Work on financing first.
Financing a luxury home is more complex, so start the process even before you begin looking at homes. Not all lenders handle jumbo mortgages, so you’ll most likely be working with a major bank. Make sure you have all necessary documentation to prove your income. You’ll also need a larger down payment. Hire a financial advisor to work with you if you don’t already have one.
3. Schedule a detailed tour of the property.
Expect to spend at least two hours touring a potential property. The larger square footage and extra amenities will require more time while you will also want to scrutinize the neighborhood and security system. Obtain a list of comparables to know how to make a solid offer. There is usually not as much negotiation in the price of luxury homes because the seller can afford to hold the property until the right offer comes in.
Building Your Luxury Home
If you are buying a pre-construction home, it means you have contracted with the builder to purchase a property upon completion with the ability to choose certain aspects of the home. You’ll get to select the finishings and certain fixtures you want, such as type of flooring and countertops. You may even have some say in the layout for the home. There are some aspects of this type of purchase you should be aware of.
The Cost of Additions
The price you were quoted for the new-build is based on certain design elements. If you alter those elements, you’ll probably have to pay extra. Some builders include one or two alterations in the base cost with any extra additions or changes incurring charges. Others give you a based model and each upgrade comes with a specific price. Make sure you know what you are paying for before you request changes, especially if you are at the top of your budget.
Since purchasing a pre-construction home involves a longer timeline, you want to protect yourself in case something in your life changes. Include a clause that allows you to sell the contract to another buyer before closing or to pay a specified penalty or fee if you should need out of the contract before the purchase. In many cases, the financial circumstances of the person changes, and they may no longer qualify for a loan. In other situations, the person may move or not be able to continue the purchase for personal reasons.
Know the Timeline
Stay involved in the construction process of your future home by keeping updated on the progress and finding out if the job is still on schedule. Delays in construction can delay your closing, which can impact your life in many ways, including your pre-approved financing. One of the ways to avoid hassles and problems in the building of your home is to work with a developer who has a strong reputation and past successes. Talk to people who have purchased their homes from him before to find out how smoothly the process went. A good developer can make your purchase easy and straightforward while a bad developer can turn it into a nightmare. Do your research before signing any agreement.
Buying a luxury home pre-construction gives you more say in what the end result looks like and helps ensure you get your dream home. Just be aware that this is unique situation that requires the assistance of an experienced real estate agent to help you navigate the process and avoid the pitfalls.
What You Need to Know About Buying Luxury Real Estate in Southern California
Southern California is a hot real estate market for luxury properties, and it can be difficult to navigate if you’re looking for a home in this area. It helps if you know a few facts about the market.
Competing with International Buyers
The first thing you should know is you’re competing with buyers from around the world, especially in China. Some are looking at real estate as an investment, some are looking to relocate while others are purchasing properties for their kids who are going to American schools. The one thing all of these buyers have in common is money to spend, so don’t expect the market to get any less expensive.
It’s All about Location
Another fact you should be aware of is the fact that some locations are hotter than others. Don’t be surprised to pay $10 or $12 million for a luxury home in Newport Beach or Newport Coast. For homes in Laguna Beach, the price can go up to $25 and even $35 million for prime real estate in this highly desirable area.
Work with a Local Agent
You want to know the details not only about the property you’re interested in but about the entire neighborhood. Are there any new planned developments in the area? Is the neighborhood increasing in value or is it a fading area that no longer appeals to buyers? Which property has the best value or is the smartest buy? An agent who knows Southern California real estate can answer these questions and guide you in the transaction. They’ll steer you away from the wrong properties and towards the goldmine that provides the perfect combination of style and value.
Buying luxury real estate in the elite neighborhoods of Southern California can be a great deal but only if you know where to look and you’re prepared for the cost and the competition. Find any agent you can trust to help you navigate this hot market and you’ll discover a property that meets all of your needs for a price that makes sense.