While it’s hard to define exactly where ordinary properties stop and luxury takes over, it’s generally accepted that luxury properties start around the $1 million mark in metro areas. In cities like New York, however, the starting point could go up to $4 million due to the extra investment interest from offshore investors. Naturally, there should be a different approach to the sale of a property to high-net-worth investors as opposed to affordable properties. Discover how to attract lucrative offers for high-end clients.
Affordable properties are marketed to the general public and the seller tends to go with an offer fairly quickly after it’s been made. For a seller of an affordable property, there tends to be a lot of competition and an offer is generally not negotiated too much. Luxury properties are a little different and agents need to prepare their clients that luxury properties stay on the market a little longer. Around 72% of the country's most expensive properties took over 180 days to sell, which is often the result of many negotiations and also the small target market.
For the agent, it’s important to market the property to a niche group of clients who will be able to put the best offer on the table. Negotiations are a little more intense from discussing priceless artifacts that are on display during the showing to finding out whether the staff will remain on. These tend to take a little longer and the agent needs to secure the best offer. It’s also important to remember that there are far higher expectations from both the buyer and the seller of high-end properties than affordable ones and that both the buyer and seller may have their representatives, agents, or proxies to deal with.
It’s not unusual for agents to create a mockup to sell a property, especially if the property’s fittings and furnishings have the potential to bring the overall price of the property down. This could mean a quick paint job, some throw cushions, and a few lighted candles. Styling a luxury property is a little more severe and requires a careful eye for detail. This means roping in the help of a professional interior designer who can highlight the best features of the room. Whether this is replacing tired appliances with high-end energy-efficient appliances or creating an entirely new area, a small investment into an update can go a long way.
A little extra can go a long way and set a property apart from others. The best way to show off features and decor is by hosting events such as cocktail parties. This gives guests the opportunity to explore the property at their leisure and experience it as they would their own home. For agents, the best way to sell a property is by allowing the buyer to see themselves in it as if it were already their home.
Considering that cities such as New York have an influx of wealthy foreign investors that make up the luxury property demographic, it’s important that the properties are marketed on a global scale. This means making the property list more accessible to these clients with the help of technology. High-end estate agents may need to employ the help of videographers, drone footage, and perhaps even software developers to remain relevant. With all this footage, 3D rendering, virtual reality showhouses, and a myriad of captivating footage will be at the disposal of the investor. For an agent, this is an important step to take to ensure they remain one step ahead of their competitors while providing actual footage of the luxury listing.
High-end real estate agents have a tough job ahead of them in ensuring that they capture the attention of a potential investor long enough to secure an offer. But interest in the property is a far way off from a closed deal, as luxury properties tend to demand a fair amount of negotiating too.