by This is Part One of an ongoing series about Luxury Home Buyers, their expectations, origins and trends.
This first article in the series will look at these buyers and what they expect from their luxury real estate agents. For some reason, I thought market knowledge and keen negotiating skills would head the list for luxury home buyers, but a recent 2007 membership survey conducted by the Luxury Home Council, and authored by Jim Remley, shows something far more basic.
So what to luxury home buyers expect? According to this survey of luxury Realtors, luxury home buyers want real estate representation that provides, in order of preference:
- 86% Help in finding a luxury home
- 56% Help in managing the transaction
- 43% Expert negotiation counsel
- 34% Advice on purchasing a luxury home
- 28% Assistance with paperwork
- 13% Help understanding the process
- 9% Help locating jumbo financing
Other tidbits?
- The average down payment for the luxury home buyer is 33.6 percent.
- The typical luxury home buyer spends 11 weeks searching for a home prior to purchase.
- Luxury home buyers, on average, look at 12 homes before making a final decision to buy.
- The typical (if such a thing exists) luxury home buyer is seeking a residence with 3500-4000 square feet, 4-5 bedrooms and 3-4 bathrooms. (Note: In the San Diego luxury home market, I believe the average square footage required by our luxury buyers will be higher.)
Like many, I might have guessed that the internet would have diminished the role of the real estate professional in the home search.
That appears not to be the case–and perhaps with good reason. Luxury home buyers, as a group, are more accustomed to seeking professional advice and reap the benefits of that counsel. Local luxury home specialists will understand market and neighborhood nuances that might not be revealed in internet searches. These luxury home Realtors will also, hopefully, have a good working relationship with other luxury specialists and will know of properties that may be available for sale, but may not be listed in the MLS. Those properties, of course, will not show up on any MLS search. They will also know neighborhoods, both private and public schools, country clubs and other factors that would suit a particular luxury home buyer–especially one is is relocating from another area.
Finally, most of us who deal in luxury real estate have found that our luxury buyers already have mortgage financing in place–and from our experience, it generally stems from a trusted professional advisor and financial institution.
The wealthy, it appear, tend to have trusted advisors in their lives–which leads us to wonder: Is that part of their wealth strategy and success?
I am inclined to think so.
Also Read:
Breaking All Barriers: Luxury Homes Reach Nine Figures
United States a Bargain for $1Million Homes?
Ultra-Luxury Home Sales to Soar in 2007?
Luxury Home Management: Ask for the Butler
Montana Luxury Real Estate Coup?
Easy Feng Shui Tips for the Luxury Home
When going to buy or sell a home, your first step should be finding a honest and hard-working realtor.
When going to buy or sell a home, your first step should be finding an honest and hard-working realtor. You can find a real estate agent by keeping an eye out for advertisements, calling your local real estate broker, or through the internet.
The role of a real estate agent is to represent your best interests in a real estate transaction. They work off of a commission, normally 6% of the sales price of the home. In most cases, that commission is split equally between the realtor representing the buyer and the realtor representing the seller. For a person buying a home, the service of the real estate agent is free, because commission is paid by the seller. The buyer, however, is responsible for most of the closing costs. The closing costs will be explained to you by your realtor and will be on the documents you sign when you go to the title company. Closing costs can also be negotiated on during the contract process.
The real estate agent, through their broker, has access to all of the MLS (Multiple Listing Service) listed homes in your area of interest. If you are a home buyer, the realtor can provide you with information about homes for sale that meet your criteria. They will then bring you to these homes and let you inside to see them. If you are selling a home, the realtor will list your home in the MLS, post a “For Sale” sign in your yard, and hold open houses to attract buyers. Be wary of discount realtors that offer to list your home for a lower commission. Studies show that, in most cases, your home will stay on the market longer and you end up selling it for a lower price than what you intended.
A real estate transaction is a complicated process that involves many steps and is best done with the help of a trained, licensed professional. A realtor can save you the headache of dealing with the other party in the sale, getting together the contract, and submitting all the documents to the title company. So when you are ready to buy or sell a house, contact the local real estate agent.
I had come to know these kind of information through the realtor site which I have recently visited http://www.realestateinwoodstock.com
This site shows much useful information about the real estate business
Roberta – great blog. I think it’s always a good idea for agents to take a step back and ask, what do my clients really want from me? The good and bad news, is that there are a whole lot of agents out there that don’t know what they’re doing, nor do they stop to think about what they should be doing. Keep it up.
Roberta,
What a great help you provided for other Realtors of Luxury Home Buyers. With your vast experience in the Real Estate arena and with higher end homes your words are wisely taken.
Great article.
SanDiegOh: (Oh…how I love your name!) Thanks for stopping by and sharing your thoughts. I agree with you wholeheartedly and wish California;s licensing requirements were more stringent.
I mean, why should a manicurist have to endure 8x the training required of a real estate agent????
Gena: I humbly thank you! Frankly, I think these expectations should apply to buyers of all properties.
And for what it’s worth, I think these guidelines would work for buyers of all sorts of homes.
Roberta – your knowledge of the luxury real estate client and your luxury blog put you in the Top 12 Bloggers for 2007. Congratulations!
Exactly…I was going to become a manicurist, but got put off by all the work it takes to become one…so I thought, hey, why not give real estate a shot? Isn’t that why we all got in the business?