Buying a luxury home, whether it is your first or part of your investment portfolio, is always a detailed process. Finding the right property and ensuring it meets your financial goals can be time-consuming when done correctly. However, learning how to buy a luxury home, or fine-tuning your process, does not have to be complicated. With these tips, you can ensure you are finding the best property on the market and making wise financial decisions.
Understand how the buying process works
If this is your first time buying real estate, working with an experienced team who can walk you through the buying process is important. For instance, you must understand the difference between prequalification and pre-approval, how to examine luxury homes and the community to ensure they meet your needs, how closings work, and other crucial information. If you are buying property within the state for the first time, it is equally important to understand local real estate law and tax implications.
Ask your connections for property recommendations
Although a multiple listing service, or MLS, is an excellent way to find properties, it is not the only reliable source. Often, homes will remain unlisted to protect the seller's privacy. Your connections, especially those in real estate, construction, or related industries, can link you up with sellers. An interior decorator may know someone who is sprucing up and staging their home before it is listed, which could get you early access. The construction company owner may know of a new community being built, which could be the right fit for you if you want a custom-built home.
Research different neighborhoods
Every neighborhood has distinct features that set it apart. The local market can vary greatly depending on zip code, but some of the best luxury homes can be hidden gems in neighborhoods that get less notice in the real estate market. Look for unique community features, such as waterfront properties, quick access to your favorite city amenities, or breathtaking panoramic views. If it is something you strongly desire that cannot be duplicated in another home or neighborhood, it may be worth living in a different area than you initially planned.
Another vital course of action when considering neighborhoods, especially if you are new to the area, is researching the local government and economy. Look on the local government's website or contact them for recent minutes and motions to see how it is run. You also want to make sure that local businesses are thriving.
Prioritize what you want in a home
You will need several features in a home, whether it is a specific number of bedrooms to fit your family or enough entertainment space to host parties and special events. When it comes to amenities, there are a lot of extras to consider, and you want to look for features that fit your lifestyle. If you frequently host elegant dinners and parties or are a wine connoisseur, a wine cellar may be a priority. A home theater may be important for comfort and fun if your household loves sharing movie nights. If fitness and relaxation are priorities, a sauna and workout facility may be upgrades that get pushed to the top of your checklist.
However, it is equally important to remember that some things are fun yet unnecessary. If you do not care for tennis or basketball, full-size courts do not hold the same value for you as they would another owner. Do not worry about additional features that you know you will not use. Instead, focus on what will complement your interests and lifestyle.
Choose a financial planner you can trust
Consulting your financial planner is imperative for making sound investment decisions. Working with a reputable, experienced team will help you meet your long-term financial goals. It may be necessary to meet with your financial planner, tax attorney, real estate agent, real estate attorney, and other team members to ensure your real estate purchase works with your broader goals. They can educate you on related costs, future tax implications, and ways to protect your investment.
Invest in your future with title insurance
Title insurance is a type of indemnity insurance that helps protects buyers and lenders against forgotten or unknown title problems on the property they are purchasing. A clean title is necessary for real estate transactions. During a title search, public records are examined to determine the property's legal ownership and whether there are claims on the property. Building code violations, back taxes, conflicting wills, erroneous surveys, incorrect signatures on documents, outstanding lawsuits, or liens against the property are all issues that present a title defect. Title insurance can prevent financial loss in the event of an unclean title.
Talk to an attorney about co-ops and condos
If the property you have in mind is a co-op or condo, there will be different ownership structures and legal implications. An experienced real estate attorney should be part of your team. They will research the building on your behalf to ensure its financial viability. They will also investigate future plans for the building and review your sales contract, so working with a specialized attorney is essential.
Visit the property in person
Even the most talented photographer cannot always capture the essence of a home. Sometimes larger homes are not as photogenic, and front elevation photographs can be underwhelming. In addition to virtual tours and searching for the property on Google Earth to examine surrounding property and features, you should always see the property in person before ruling it out. The only way to fully appreciate a property is to walk through it, examine its specific features, and take time to assess whether it meets your needs.
Work with a buyer's agent who knows the area
A buyer's agent specializing in high-end properties is imperative for your search. They know the local market and can help you find a house that meets your criteria in your desired neighborhood. They also have connections throughout the real estate world, which is necessary for finding unlisted properties. When it comes time to negotiate, having an experienced buyer's agent on your side who is willing to fight for you with integrity and tenacity will pay off.
Choosing an agent with local knowledge and connections to help with your real estate is a smart decision. The experienced real estate agents at Hawaii Global Luxury Group take pride in building relationships with their clients to understand their goals and best meet their needs.
*Header photo courtesy of Hawaii Global Luxury Group
