Selling a luxury home in Los Angeles can certainly be a complex and challenging process. The market for luxury real estate in Los Angeles is highly competitive, with high-end properties commanding top dollar and record-breaking prices. To successfully sell a luxury home in Los Angeles, it is important to understand the various aspects and distinctions of the luxury real estate market, as well as the marketing strategies that are most effective.
As a luxury listing agent in Los Angeles, it is my job to help my clients navigate the complexities of the luxury real estate market and create a detailed and hand tailored marketing strategy that will showcase their property in the best possible light. Having a brand like Coldwell Banker Global Luxury behind me is of immense value! Here are some of the key aspects and distinctions to keep in mind when selling a luxury home in Los Angeles.
First, Let’s Define “Luxury Real Estate”
The definition of Luxury real estate perhaps starts as maybe the top 10% of the market. Market by market, throughout the country, this can vary, though. It doesn’t vary nearly as much as defining a luxury home as a “million-dollar home”. That train has certainly long left the station throughout a large part of the United States and the world.
As the luxury market is a segment of the overall real estate market, the luxury market has its own segments as well. Within the top 10% of highest valued properties available, you’ll have the top 5%, top 2% and, of course, the top 1%. Luxury properties typically make up a small segment of the overall real estate market. The generic categorization of luxury would be a property well above grade to the rest of the market, with high-end finishes, architecture, and property design.
One of the most important aspects of selling a luxury home in Los Angeles (or anywhere) is, of course, the location of the property. A luxury home constructed in a location that doesn’t quite match its appeal will tend to be negatively impacted by functional obsolescence, in terms of value. Likewise, a luxury-level location with a home that doesn’t perfectly complement it can be a significant value-add opportunity. It is, indeed, a complementary relationship. These aspects must fit together. We see it when it’s done just right like a classic piece of art, and we see it also when it’s not.
Los Angeles is a vast city with a diverse range of neighborhoods and communities, each with its own distinct beauty, charm, character, features and appeal. When selling a luxury home, it is important to highlight the unique features and amenities of the local area, as well as the property, itself.
Luxury Features and Amenities
Luxury homes in Los Angeles are typically packed with high-end features and amenities. These may include state-of-the-art home automation systems, custom-designed kitchens and bathrooms, outdoor living spaces, and other luxury features such as swimming pools, spas, full fitness centers, ball rooms, night clubs, 25 (or so) car garages and home theaters. As a luxury listing agent, it is important to highlight these features in your marketing materials and showcase them in all of their extraordinary light.
Pricing a luxury home in Los Angeles can be a delicate balancing act. On the one hand, you want to price the property high enough to reflect its true value and appeal to luxury buyers. On the other hand, you don't want to price it too high and turn off potential buyers. A luxury listing agent with extensive experience in the Los Angeles luxury real estate market can help you develop a pricing strategy that will contribute greatly to attracting the right buyers and maximizing your returns. The process of arriving at the ideal list price differs greatly from the more traditional segment of the real estate market. In most instances, there aren’t going to be many comparable sales and dollar per square foot calculations have zero chance of accuracy. There just simply is no substitute for experience here.
Marketing a luxury home in Los Angeles requires a multi-faceted approach that combines traditional and digital marketing strategies. This may include high-end print and online advertising, virtual tours, social media marketing, and other strategies designed to reach luxury buyers and showcase the unique features and amenities of your property. A luxury listing agent can help you develop a comprehensive marketing plan that is tailored to your specific property and target audience.
The main component of marketing the luxury home is identifying the buyer, or most likely potential buyers. This involves working closely with the seller to analyze the most compelling features of the home and at times developing a deep understanding of the owners’ psychological relationship with the property.
“The story” then needs to be constructed and ultimately told effectively and consistently throughout the marketing of the property. Video is categorically the best means of all types of media to tell this story. In fact, for ultra-high-end homes, actors may be hired for more of a cinematic production with a story line.
The carefully constructed message targets the identified group of potential buyers. The market for a specific property. For luxury properties, this tends to be a small group and the group gets smaller and smaller as the price point goes higher.
So, Who is the Buyer of Luxury Property?
The luxury real estate market is an alluring world filled with extraordinary properties that appeal to two main types of buyers. The first group views their purchase as a symbol of their triumphs and the culmination of their hard work. After putting in endless hours of dedication and effort to get where they are, they consider this acquisition as a well-deserved reward. For the second group, the allure of owning a remarkable home in a breathtaking location is the ultimate unifying factor for their family. The psychological nuances of the real estate business are multifaceted, with the luxury home market being no exception. It requires a careful balance of strategies and an astute understanding of the market to achieve the highest level of success in a sale.
Closing the Sale
Closing the sale of a luxury home in Los Angeles can be a complex and time-consuming process. From negotiating the purchase agreement to coordinating inspections and appraisals, there are many steps involved in successfully closing a luxury real estate transaction. A luxury listing agent with a track record of success in the Los Angeles luxury real estate market can help you navigate this process and ensure that your transaction goes smoothly from start to finish.
There’s additional marketing expenses and creativity involved in the sale of luxury properties, and they certainly can take more time to sell. A six month to twelve-month listing term is typical. These transactions may take months and sometimes years to arrange and close.
Selling a luxury home in Los Angeles requires a comprehensive understanding of the luxury real estate market, as well as a strategic and targeted marketing approach. By working with a luxury listing agent who has extensive experience in the Los Angeles luxury real estate market, you can maximize your returns and ensure a successful transaction that meets your goals and exceeds your expectations.
Aside from the trophy properties in the absolute best locations and the tact, creativity, resourcefulness, and astute attention to the psychological aspects of identifying and securing the right buyer, the sale and purchase of luxury real estate heavily revolves around equity and wealth preservation and, possibly even more importantly, taxes!
The right advisors are needed to properly navigate the unique terrain and arrive at the best possible solutions. Knowledge and experience are, as a result, priceless.
“Selling Luxury Homes” written by Jack Cotton published by Tide-mark Press ltd.