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10 Things to Keep in Mind When Buying a Luxury Home

Maybe you recently came into some money, or maybe you’re just looking to buy a luxury home as an investment. Whatever your reasons, how you go about buying an expensive house is as important as buying itself.

Here are some key tips to consider when shopping for the best luxury properties.

Buying a Luxury home

10 Tips for Buying a Luxury Home

1. Consider the Location

One of the biggest differentiating factors in some of the best luxury homes on the market is where the home is located. You only need to consider the popular 90’s TV show 90210 to see this point clearly—it’s all about the zip code.

DO: Look for uniqueness. Perhaps it’s a specific feature that makes it the best luxury property—something that cannot be duplicated in another similar luxury property. The home could be near a well-known waterfront, within a highly-desired city, or located in the wilderness with a breathtaking view.

DON’T: Settle on the photographs. Many of the most luxurious houses look horrible in photos. Really look at the property as a whole. This leads directly into tip number 2: looking for timelessness.

2. Look for Timeless Design Features

Another key element in the search for the best luxury home is paying attention to architectural elements and materials. You want to know that the design is going to be timeless. If you plan to resell in the future, you want a design that will continually appeal to a broad spectrum of buyers.

DO: Buy luxury homes that are unique and timeless in their design to ensure a good return on investment in the future.

DON’T: Buy another cookie-cutter home. There is nothing unique that would add value to the home in the long run.

3. Learn About the Market Value of the Home

Market Value of the Home

Know the market value of your home while speaking of value, this brings us to our next point—make sure you know and understand the importance of valuing the luxury property you are planning to purchase.

DO: Educate yourself on property values in the area. Make sure the luxury home you have your eye on is within the midrange of other properties nearby. Remember, housing costs include not only the luxury property itself but also the value of the surrounding homes.

DON’T: Buy the most expensive luxury property in the neighborhood. When it comes time to sell you will find it hard to recoup your investment if you are overbuilt for the neighborhood.

4. Consider Long Term Risks Associated With Low-Quality Materials

When buying a luxury home, you want to know it’s going to stand the test of time. This is why you need to pay attention to the materials used to construct the home.

DO: Consider buying luxury properties that have concrete construction. This is by far the slowest degrading material and will keep your home value at its highest for the longest period.

DON’T: Purchase a beautiful home built with subpar construction quality.

5. Consider Maintenance and Upkeep Costs

This may not be a top consideration, but it should be kept in mind when buying a luxury home. The maintenance on a luxury property is an entirely different animal than the maintenance on a regular home.

DO: Ask around and educate yourself on the costs associated with the upkeep of the luxury property you are considering.

DON’T: Get swept away with luxurious features like a pool or tennis courts unless you know what they require for maintenance. Getting into a maintenance nightmare is no way to enjoy your new luxury property.

6. Look for Interiors Offering an Open Concept Plan

As mentioned before, you are looking for a luxury property that will stand the test of time—an open concept interior will do just that.

DO: Look for grandiose features in the living areas like the kitchen and living rooms. Similarly, look for luxurious fittings in the bathrooms and closets. A large amount of time is spent in these areas, so this is where you want your money to go the furthest.

DON’T: Get caught up in a humongous master suite. Square footage in this area at the expense of other living spaces is wasteful. After all, you generally only spend your time sleeping in this room.

7. Check for Amenities

Amenities are one of those fun areas you get to enjoy when splurging on a luxury property.

DO: Look for fun features like pools, saunas, wine cellars, or workout facilities that fit into your lifestyle. There are so many upgrades available in luxury homes, you’re sure to find those that are on the top of your list.

DON’T: Consider features you won’t use as added value. Even though a gun range or a climbing wall might sound like a good idea now, does it really fit into your lifestyle? You’ll want to have a good handle on amenities you consider important before getting swept away with options during the luxury property search.

8. Consider the Surrounding Community’s Impact on Your Home

As noted before, location is a huge factor in the search for the best luxury home for your money. If you’re moving to an area you aren’t familiar with, consider hiring a local expert to help narrow down your choices based on desirable neighborhood traits.

DO: Look into how the local area’s government is run. You can easily find information like recent minutes and motions recorded during local government meetings on their websites.

DON’T: Consider buying in an area where businesses are being run out in favor of more homes. Typically, wealthy people own their own businesses, so you want to buy where local businesses are thriving within their community.

9. Look into Financial Implications of Your Purchase

Look into Financial Implications of Your Purchase

There are tax loopholes that can be advantageous when considering a luxury property. One such example, the “1031 exchange”, allows you to defer capital gains if using them to purchase a “like-kind” property. This alone helps stretch your financial investment.

DO: Learn the tax laws associated with the purchase of a new luxury property or hire a professional to review the implications with you. Either way, make sure you are educated so you can stretch every dollar of your investment.

DON’T: Bite off more than you can chew. Make sure you know all of the costs associated with your new luxury property. Not finding out the full story at the beginning could find you in beautiful new luxury home with no money to furnish it.

10. Consider the Future

Part of looking for the best luxury home is considering your future in it. You need to keep an eye on surrounding areas and determine whether they will affect the long-term valuation of your property.

DO: Consider the implications of empty or undeveloped land near your proposed luxury property. Find out if there are plans to develop the land before you consider your purchase.

DON’T: Assume the value you bought is the value that will remain. Do your homework to mitigate any future risk to the value of the luxury property you are looking to buy.

Is it Really Worth It to Buy a Luxury Home?

Whether a luxury home is worth it to buy depends on you. If you educate yourself on the ins and outs of the process, you will likely avoid some major pitfalls. Also, make sure you have a clear picture of what it is you are looking for before you go house hunting.

Armed with a clear budget, some know-how, and an expert by your side, anyone can learn how to buy the best luxury home.

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