It can be hard to say what makes a luxury home. It could be size, presence, or even just a sense of importance – historical value, for example. So, when it comes to investing in the luxury property market, it can be difficult to work out whether you can make a good return or not.
To help you out, we’ve put together this little guide of tips for making the most out of your new investment. Read on to find out everything you need to know.
An experienced estate agent
Whenever you buy any luxury property, always go through an estate agent with experience in the luxury market. They will be able to help you find the right property for the right price, and will know the local market inside out.
They may even have a little insider info for you, on properties that may not be on public sale. Plus, they will have an idea of where the local prices are heading. A luxury apartment in an area targeted for gentrification, for example, could prove to be something of a goldmine.
The law of supply and demand
Luxury properties go through phases, dependent on the local supply and demand. Of course, because luxury homes are exclusive, there are only ever a limited amount on the market – and a smaller pool of buyers to tempt.
While more expensive homes and apartments can take longer to sell, the trick is to make your property as tempting as possible. Once you start getting a few bids from people for whom money is no object, it can drive up your asking price by a significant amount.
The ideal location
Luxury properties are a better investment when they are in the right areas. Places, where unemployment levels are low, are ideal, but there also needs to be plenty of high paying jobs. In cases like this, you can choose from a wide selection of properties, from mansion homes and penthouse apartments. All of them should be a safe bet, and give you a chance of getting a better return.
Don’t forget, these types of places can often be attractive to foreign buyers, too. If there is a lot of international business operations in a particular area, it can be a great tool for bumping up your home’s value.
Due diligence and checks
It makes sense that the more money you spend, the more checks you should be making to ensure you don’t waste a cent. The trouble is that luxury tends to come with extra features. You might have pools and spas, for example, or lawn irrigation systems, and high-tech security systems. All of them will need specialist inspectors to come and take a look to ensure they work.
It’s also worth pointing out that these types of amenities are expensive to fix. If you are renting out a luxury property, for instance, they will be your responsibility to maintain. And, if you are buying it as a home, it will be an ongoing cost you need to consider. It’s vital that you understand these costs and the impact they will have on your overall expenses throughout the whole time you live there. Good luck with the search – and let us know how you get on!