Market Trends and Investment in Luxury Homes

In a sense, there have always been three different types of real estate: residential, commercial, and luxury. While it may be common knowledge that the key to marketing any property depends upon knowing an audience, knowing the trends and changes of the audience also makes a huge difference. One population that is quickly changing involves those who have traditionally been interested in luxury real estate. Foreign investors have a prominent and growing influence in the luxury home market in many major cities. Buyers from China, Syria, Mexico, and Russia are emerging as big players in the luxury market in recent years. Therefore, it is essential for investors to understand how luxury real estate buyers are changing in order to adapt their marketing techniques in an effort to meet the new needs of the luxury real estate customer.

With luxury homes real estate buyers gaining confidence in the real estate market, there has been an increase in luxury real estate purchases throughout 2013, especially since many believe that home prices will only continue to rise and therefore homes purchased now will be worth more in the future - making real estate a "safe" investment once again. It is essential for investors and realtors to understand the mindset of these wealthy buyers. First and foremost, size does matter, but often not nearly as much as the artistic value the home has to offer - many prefers homes that lend itself to a great story. Second, brand matters. Just as wealthy individuals prefer brand name clothing, they also prefer real estate properties that have been branded. These individuals think about the potential to sell the property in a future and obtain a nice return on their investment; therefore, although they are wealthy they are still looking for a great deal.



The luxury homes real estate market will more than likely continue to grow throughout 2013, with many wealthy individuals opting to purchase real estate with the expectation that they can later sell the home once the real estate market normalizes, eventually gaining a profit. However, in order to meet the needs of these buyers it is important for investors and realtors to know what this specific clientele is looking for in a new home and make viewing the home worth their time. Seeking out the expertise of realtors with experience in luxury home investments is important to keep up to date on the rapidly changing trends and patterns. In searching for the right property, it is important to know and understand the nuances of the neighborhood that you want. Exclusivity, security, unique features, and ownership history of the property are only a few of the many important factors for consideration.

The one thing all luxury homes have in common is that they sit in the most sought-after locations in the country. The commonly top-ranked features of a luxury property in every key market can include being in close proximity to a downtown core, near the best schools or having a breathtaking view. Some international buyers invest for the lifestyle a luxury home affords, and because they loved the city, but other wealthy investors buy high end real estate for long term business investment. Despite the price tags involved, these buyers are more likely to pay in cash and opulent extras such as wine cellars and movie theatres are popular. But for those looking to make major purchases to enhance their own quality of life -- especially those in the market for high-end properties -- now may be the best time in years to consider moving forward with that dream home or vacation getaway. Prices, while rebounding, remain low; mortgage rates are still highly favorable; and there's plenty of room for a property's value to grow over time. Perhaps best of all is the sense that buyers are investing in a market that seems to have finally picked itself up off the ground. A luxury home tends to always hold its value better than most during the depths of the recession or decreased market activity. The good news is that a more tentative market means there's time to search out available properties in the best locations, find the right home or investment property, and make a favorable deal.

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