Breaking into the luxury home market
It’s the holy grail for many Realtors: working with ultra-affluent clients who are buying and selling luxury homes. Whether you’re selling luxury real estate regularly or hope to break into the market soon, we’ll give you the tips you need to be successful.
What constitutes luxury real estate?
No specific dollar amount denotes a “luxury home;” that figure is mostly dependent on geographic location and current real estate market trends. For instance, the average price of a luxury home is $2.5 million in Los Angeles, but $1.5 million in Fort Worth, Texas. In general, a home listed at more than $1 million is considered part of the luxury real estate market.
Luxury real estate caters to the ultra-high net worth investor – a buyer or seller who wants something spectacular and unique.
How do I break into the luxury real estate market?
Many Realtors want to know how they can get a piece of the luxury real estate pie. The process of connecting with an affluent client is the same as any other client – only magnified. There are far fewer wealthy clients than there are real estate agents, so competition is fierce. That’s why you need to know how to close the deal once you get that coveted ultra-wealthy client. If you’re still struggling to break into the luxury real estate market, check out this expert advice from a successful Realtor.
Most high-earning real estate agents have worked their way to the top. Don’t expect to gain wealthy clients in your first year as a Realtor. Experience takes time. Start by learning the ins and outs of your market area and building your network. In time, your experience will translate to credibility, which will earn you the clients you desire.
High-end clients are typically well-educated, savvy business people who want to deal with a dedicated and knowledgeable real estate agent. Therefore, make sure you do your research and can answer detailed questions about the local real estate market and comparable properties, and that you lay out all the options for your client. Once you demonstrate your ability to find a home for the wealthiest clients, word will get around – and word of mouth is always the best advertising.
Understand the needs of your buyers
Ultra-wealthy buyers may be less concerned with the sticker price, but more concerned with the lifestyle and amenities a property offers. Make it your goal to understand your clients thoroughly. For instance, what kind of lifestyle do they wish to live? Do they want a secluded lot, or do they prefer to be in the center of the action? How about access to a country club? Do your clients want a pool, tennis court, theater room, butler’s kitchen, or mother-in-law apartment, for instance? What about space for kids, grandkids, parents, or other guests?
Once you understand how your clients live – and therefore what matters to them most – you’ll be much more likely to find the ideal property for your clients.
Pay close attention to the details
Whether you’re representing the buyer or the seller, it’s important to know every property inside and out. If you want the high-figure sale, you need to put in the high-figure effort. As the selling agent, you should know every inch of the property: construction, upgrades, finishes, materials, security features, and unique aspects of the home.
If you’re the buyer’s agent, do your research on every home you show to your clients. Know the comparable sales for the neighborhood, the unique features of the house, and how the property would fit your buyers’ needs.
Market in the right places
Luxury real estate requires a different approach to marketing. First, every detail – from staging to photography to virtual tours – must be exceptionally professional and beautiful. Then, it’s time to think outside the box. Consider advertising in magazines geared toward the ultra-wealthy. Advertise on local television. Contact other real estate agents who work with wealthy buyers. Also, be sure your website is up-to-date, professional, and features the luxury home prominently. If you need help getting your website in tip-top shape, we offer multiple tools to make your site efficient and visually stunning.
Set realistic expectations
The luxury real estate market requires one thing above all else: patience. A multi-million dollar property isn’t going to sell overnight. Set this expectation with your clients, but more importantly, set it with yourself. There’s a limited market for luxury homes, and finding the right buyer can take months. Keep advertising, keep working hard to connect with potential buyers’ agents, and eventually, you’ll close the deal.
Breaking into luxury real estate can be a merciless process. Making a sale as a Realtor to the ultra-wealthy can be even harder. But with one or two successful closings behind you, your business will begin to blossom.