Buying a luxury home is a little different from buying the average tract house. Obviously the expense itself is a large concern, but more and more luxury buyers are using the home as an additional asset in their overall investment portfolio.
In the 1950s the dream was to find a home and pay off the mortgage, now many financial advisors recommend using the mortgage as a way to not only offset income taxes but to leverage capital for other investments. For those just entering the luxury home market, it’s important to know what to look for so that the home not only provides a pleasant living environment, but also appreciates in value.
First and foremost… location. Cities, communities, neighborhoods are all very important factors in purchasing a luxury home. More than many home purchases, finding the right real estate agent can make a huge difference. Your agent should be able to direct you to homes in areas with appreciating value and know the reasons why.
Communities and neighborhoods are also very important. Many luxury buyers look for gated communities; security and privacy are important aspects to the home’s location. If you are looking in a location which offers views, such as a beach town or city, then you also want to have a nice view. Remember that if this is intended to be used as a part of your financial portfolio, then increasing value is a critical part of the home purchase.
There are common amenities seen in most luxury homes:
• Upgraded kitchens and bathrooms
• High ceilings
• Open floor plans
• Specialty rooms, such as library, media, gym, bonus or wine sellers
• Larger garages or parking for more than 3 cars
• Nice outdoor entertaining areas
• Reputation of neighborhood
Get a complete inspection done on the property. Spending a few hundred dollars on this expense you can save thousands in problems that you cannot see. By, getting a comprehensive full inspection you can rest assured that you know everything that is wrong with the luxury property. In the contact for the luxury house you need to make sure that you have provisions to have a complete inspection preformed, and if the inspection finds problems that are going to cost more money that you are willing to invest you can get out of the contract with no penalties. It’s commonplace to inspect suits, dresses, trousers or shoes before buying them. People instinctively know they need to try on clothing to be sure they fit, feel comfortable and are attractive on them. Isn’t it even more important to inspect a home investment before you purchase it?
Luxury homes in the United States have become a great investment tool. The United States luxury home market is still more affordable than most countries. As this trend continues, the value of these homes will rise accordingly. Foreign buyers are flooding our luxury home market with cash. Purchasing a home for yourself in this environment might not only provide you with a lovely home but could appreciate in value significantly over the next few years. A luxury home purchase is a great way to diversify your financial portfolio.