8 Important Tips When Buying Luxury Properties

Posted by Derrik Carlson on Monday, November 24th, 2014 at 6:54pm

1. Understand “The Search”.

Technology and the internet has changed how homes are found and the current statistics show more than 95% of home buyers start their search online.  I will tell you I have not had a client in the past three years that has not used the internet to search for their future home.  The important thing you should know is that not all search sites are the same.  Often it takes 24 to 72 hours (or more) for properties to hit websites that are syndicated - Zillow, Trulia, etc.  If you are not using a hot search directly from the Multiple Listing Service (MLS) you could be days away from seeing your dream property - possibly days behind the other buyers.
 

2. Photos May Be Worth 1,000 words – or Leave You Saying Huh?

Many brokerages have a professional photographer that shoots photos of the home and manipulates the images by boosting colors and using lenses that make the rooms look larger than they actually are in real life. While other brokers use inexpensive cameras that provide poor quality pictures and this could possibly be an opportunity for you to find a hidden gem.  Another option that I often do for out of town buyers is to take a quick video and upload it for you to review online.
 

3. Work with Local Experts and Hire Reliable Advisers. 

It’s important you work with local appraisers, attorneys, title companies, real estate brokers, and possibly lenders that understand the local nuances of Real Estate.  In Park City there are as many as 25 micro markets that all have their own history which plays into pricing.  Recently, there was an agent that was "helping" their buyer find investment properties in Park City and put several homes and condos under contract.  Because the agent wasn't familiar with the are they often had no listing history, comparables, and the negotiation process went poorly.  Several of these homes never closed because the agent didn't understand the local market.  
 

4. What’s Going To Happen By The Year 2024?

Look at the view and possible access to your property.  Some time back there was a real estate developer that didn't realize that there was an easement going right down the middle his property; this added to lengthy and costly negations with the adjacent landowner.  Ask your broker or title company for plat maps of what can be built in your neighborhood that could steal your views.
 

5.  Luxury – Now is the Time to Buy.

Here in Park City home and condo sales volumes have reached the 2006 mark and have seen strong appreciation over the past several years.  In Park City homes sales over the price point of $2,800,000 drop off, this may be much different than your market, leaving opportunity for negotiation in the purchase price.  This also provides home buyers the opportunity to up-size by selling their lower priced home or condo and quickly reenter the market on a higher basis so they may ride up appreciation as home prices increase. 
 

6.  Be Ready to Show You Have the Ability to Purchase.

Many sellers will want to ensure you have the ability to purchase their home before you preview the property.  Do not be offended by this request as it will give you the ability to negotiate from a position of power.  On the same not do not provide a dollar amount you have available or for how much you are pre-approved – simply have your banker or mortgage broker say you have the ability to purchase a property in the price range of which you are looking.
 

7.  Cash is King but Not All Sellers are Desperate.

In our local market approximately fifty-percent of homes are purchased with cash.  Cash purchases are often simpler but it does not mean the seller will give the property away.  Many luxury home sellers are financially savvy and will become offended by a low-ball offer.  Low-ball offers frequently start negotiations off on the wrong foot and kill the deal before it really even started.
 

8.  Fixer Uppers Carry Risk.

I never worry about offending a bank with a low-ball offer but I do ask my clients to consider the risks when buying a home from a bank or financial institution.  Banks are able to sell a property stating they essentially have no knowledge of the condition or history of the property.  Hire an experienced inspector to look at every floorboard, water pipe, and shingle to make sure you are not purchasing a money pit. 
 
Contact me with any luxury real estate questions at Carlson@RealEstateInParkCity.com
 
Contact Information:
DERRIK CARLSON | (435) 200-5478
Certified Negotiation Expert (CNE®) | Institute of Luxury Home Marketing Member (ILHM)

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