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The New York City real estate market experienced a major blow in 2020, resulting from the pandemic. Landlords had a hard time filling vacant apartments. Property owners, on the other hand, struggled to find buyers.
Thankfully, 2021 has registered a major turnaround, and the market is showing signs of life. In the first quarter of 2021 alone, Manhattan had recorded a higher number of luxury home deals than 2020’s total.
There were an impressive 694 signed deals for homes asking $4 million and more in New York City.
Whether you’re looking to live in New York, LA, or London, if you’re curious about investing in luxury real estate, here is everything you need to know.
What Does Luxury Real Estate Entail?
It is critical to understand the characteristics of luxury properties before investing in one. High prices alone does not place a property into the luxury category.
Luxurious properties are exclusive and unique in a desirable way. Since you have to pay a premium to access such properties, they need to be worth the price.
Luxury properties are found in high-end locations. These are places where you can easily access luxury activities and amenities such as dining, shopping, and leisure activities. A luxury pool, spacious outdoor living area, car lifts, and owners’ suites are common comforts found within luxury properties.
Furthermore, the properties should be surrounded by other luxury homes. The views should also be world-class. For instance, Park Avenue in New York City is a place high-end buyers love to visit and own.
Often there are waterfront views, lakes, or oceans nearby. If you are looking for a calm environment away from chaotic urban areas, a mountain or countryside view may fit the description.
Ideally, luxury properties have features that you cannot easily access at a lower price point. The security, privacy, and infrastructure should be unmatched. The architecture, finishes, and design should all feature an attention to detail that cannot be readily found anywhere else.
The Right Places To Look for Luxury Homes
As earlier mentioned, luxury properties are found in high-end locations. Thanks to technological development, you can now hunt for luxury properties online.
You can search for luxury properties in urban areas like New York City, Los Angeles, or Washington, DC. Alternatively, you can peruse luxury estates that feature oceanfront or mountain top views. You can use various filters to select the properties that include your preferred features.
It will also help to discuss the type of property that meets your needs and budget with your broker. This will let them identify the most appropriate area and position them to secure your desired amenities and features.
Another options is to check out sites like this one to find prescreened properties to choose from. It’s a “go-to” site for luxury real estate in Manhattan and Miami that features buying guides for these areas.
The Cost of Luxury Properties
The cost of luxury properties varies depending on the market condition. During a buyer’s market, you can sometimes acquire luxury real estate for as little as half a million. On the other hand, a seller’s market will often features higher prices that can soar into the millions.
Of course, location also plays a critical role. For example, the average price for luxury real estate in New York is $7.6 million.
If you’re looking to get the best possible deal, then you will want to understand market trends so you can acquire your luxury property at the most affordable price. Identify whether you are in a buyer’s or seller’s market and don’t rush to purchase without comparing prices.
Seller’s markets are characterized by high property demand. In these markets, properties sell fast and fetch at or above the property’s asking price.
Conversely, buyer’s markets feature low property demand. Thus, properties sell bit slower and at substantially lower prices. This is the best time to go property hunting. You can make lower offers and know that the seller will consider it.
Demand for Luxury Properties Is on the Rise
2021 has registered a significant rise in luxury property demand. This is due to the coronavirus vaccine rollout, as well as people wanting to get back to more normal life.
While the delta variant leaves us with some unanswered questions, there have been major improvements on the pandemic front. Businesses are gradually opening and people are easing back into leisure activities. This has prompted individuals to search for homes near the action. Buyers are striving to acquire high-end properties so they can enjoy both space and proximity.
Given 2020’s exodus from major urban areas like New York, this is the perfect time to acquire a luxury property at a discounted price.
Is Luxury Real Estate Investing Worthwhile?
If your budget allows, investing in luxury real estate can be an exciting decision. Beyond the pride and perks associated with luxury homes, these properties are usually easy to maintain.
They feature tip-top finishes and architecture. The quality of the properties matches the value of your money. So you can trust that the property will serve you for a long time without the need for repairs.
Plus, luxury properties are often located in prime locations, so you get access to high-end services that you cannot find in standard properties.
Nearly everything will be right at your doorstep or within the building. This can save you time, stress, and money.
Live Better and Bigger With Luxury Real Estate
There are numerous ways to own a luxury home, from building a custom condo to purchasing a vacation home. However, before investing in luxury real estate, take your time to understand the market trends and what to expect.
I hope this guide taught you the basics of luxury real estate investing. With this information, you’re now positioned make informed decisions about when, where, and why to buy at various price points.