Having just attended a Who’s Who in Luxury Real Estate conference with a group of preeminent luxury real estate practitioners from all over the world, it seems a good opportunity to give an overview of what’s happening currently in the luxury market and hopeful trends on the horizon.
First of all, it appears sales are definitely increasing. Particularly in coastal markets, price corrections seem to have been achieved and REALTORS® are even seeing multiple offers again in many markets. For those of you watching for the “bottom” of the market, it appears that there are signs in many markets that prices are starting to rise.
Trends have emerged, though. It has never been more important to hire a REALTOR® to assist in analyzing the market. Pricing is sometimes arbitrary and it is important to understand the local market with the professional’s help to ensure that you are truly getting a value opportunity. A REALTOR® is also important to assist in the newly complex world of financing the property. Lenders have new guidelines, some of which can be cumbersome. A well qualified mortgage professional, working with you and your REALTOR®, will streamline the process and make it much easier. Rates are still at historic lows, so often you save additional money over the time value of the note.
In Santa Barbara, for example, the middle market is holding its value, but there are a few opportunities in the high end and lower end of the market. Similarly, other ski resort communities are seeing prices holding steady throughout, clearly because our areas are heavily fueled by past cash transactions and are often held by second homeowners who don’t necessarily feel the pressure to sell. Arizona and southern California are roaring back, with lots of activity. If you want to purchase something, prices are already creeping upward again.
In the Summit County, Colorado and Breckenridge markets, there are actually more sales in the very highest end of the market than at this time last year. There is considerable inventory in the lower end of the luxury price ranges, though, so there are a few strong value opportunities. Summit County is historically a great solid investment area, with local prices and values not experiencing the dramatic swings that other areas such as Florida and California sometimes do.
When considering a second home or investment, however, do not concentrate on the “deal” as much as solid criteria for selecting the property. First of all, the floor plan should be a good one and suit today’s lifestyle and your needs in particular. You can remodel with more recent finishes, but the fundamental “bones” of the home need to work well.
The location is important and your REALTOR® can assist in discussing on-mountain versus town versus remote locations. Your selection will be based on how you will use the property yourself and your lifestyle needs. A view is often a sought-after feature and, thus, is valuable for resale. Remember that to be a solid long term investment, it is important to choose a residence with broad appeal. The same things that attract you to the home will help sell it when the time comes.
When looking for a second home, according to the National Association of REALTORS® surveys, location is number one. Additional features that are important to luxury buyers include well designed kitchens, main floor master suites, bedroom-bath suites for secondary bedrooms, a separate “family” or media room, storage, and updated bathrooms.
As the economy strengthens, it has never been a better time to invest in a solid market like ours. This is the perfect time to consider an investment you can enjoy which fits into your long term investment strategy. If you need a real estate expert anywhere in the world, email me at: bonnie@bonniesmith.com and I will make the introduction for you.