This April, the 51-acre Copper Beech Farm located in Greenwich, Connecticut sold for $120 million, representing the most expensive single-family home sale in American history. Record-setting luxury real estate trends have been sweeping the nation in recent years, with billionaire hedge fund manager Kenneth Griffin setting Chicago’s record in November 2012 with his $15 million purchase of a full-floor penthouse in the Park Tower. Luxury homes are selling at twice their historic average, the National Association of Realtors reports, with sales of homes over $1 million increasing 7.8 percent in March compared to last year. Buyers who can afford it are snapping up luxury real estate homes in a historic boom, and builders are cashing in on the opportunity by constructing more expensive homes. If you’re considering buying or selling a luxury home, it pays to know what kind of standards are expected in this exquisite and expensive market.
Consider Location First
Since at least 1926, real estate experts have stressed the primacy of property location, as Fox Business writer Brendon DeSimone notes when outlining some variables that make for desirable locale. Some basics include value of homes in the same neighborhood, safety, proximity of important facilities such as schools and hospitals, accessibility, utility coverage and views of water and other scenic elements. When considering luxury home locations, you should view value through the lens of land development potential, and do due diligence into whether foreclosures represent investment opportunities or warning flags. Keep an eye on potential resale value for your prospective property.
Build on a Firm Functional Foundation
It’s easy for luxury home buyers to get excited about amenities such as putting greens, meditation parks, custom kitchens and entertainment rooms. But you can always add most of these items in if your property has the underlying prerequisites, so the smart strategy is to prioritize determining whether your home has its underlying functional essentials intact. Are your outdoor views unobstructed? Is your interior lighting sufficient? Are your ceilings high enough for a luxury look? Do you have enough storage space? Are your windows properly paned and insulated to keep you comfortable? Start building your luxury home from the ground up by covering your basics. For instance, depending on your location, invest in a reliable and high-quality window contractor such as Champion in Chicago and make sure you’ve got in-unit laundry and other essential practical items. You can always customize your kitchen later.
Invest in the Right Developer and Contractors
Extra TV’s “Mansions and Millionaires” host Michael Corbett emphasizes that since luxury homes tend to be customized, it’s important to remember that when you buy an unfinished property you’re also investing in your developer. Corbett recommends checking out prospective developers by researching their financials and asking other home owners about property value and complaints. Similarly, the FTC provides guidelines for hiring contractors, recommending you check their reputation and get written estimates from several firms. Due diligence is the best recipe for solid craftsmanship.