Purchasing a luxury home is quite a different process than the one we find in the broader real estate market.
There are key details that affluent buyers should know before setting expectations and jumping into the marketplace. Hi, I’m Dawn Thomas, with Siliconvalleyandbeyond.com, and today I’ll be sharing “5 Tips on Purchasing a Luxury Home.”
1) Work with a Real Estate Professional who has experience in the luxury market. The higher the price band in which you are interested, the fewer the experienced and patient professionals you will find that understand the luxury market. My largest sale to date was in late 2014 of an over $40M sale of a trophy property. I worked with my clients for nearly 3 years before they decided on the estate they purchased.
2) Learn how to search for a Luxury Home. Many luxury homes go unlisted on the traditional MLS and the wider internet. Many Sellers want their business kept confidential and do not want their estates marketed to the masses. Hiring a Real Estate Professional with experience in the luxury market is how you gain access to these unique estates. Many of these properties are often found through the Realtor’s personal connections as opposed to the MLS. For instance, over 50% of Atherton’s real estate is sold off-market.
3) Background checks are required for showings. It is very common that I get asked a series of questions by a Listing Agent before I can confirm an appointment to see an estate. The Listing Agent is usually doing so at the request of the Seller. They want to make sure that I’ve done a thorough job of qualifying my Buyers and that my clients are in a position to purchase the property.
4) Be prepared to provide a “Letter of Financial Introduction” (otherwise known as an Asset Verification Letter) to your Real Estate Professional that has been written by an executive at your bank on the institution’s letterhead. Your Buyers Agent will need this letter upfront. It will be shared with the Listing Agent and most likely the Seller of the estate in which you are interested. The letter is proof to the Listing Agent and Seller that you are not just someone interested in taking a tour of their property and you actually have an interest and the ability to purchase it.
5) Thoroughly investigate the property. Most luxury home sellers do not perform pre-marketing inspections as the timeline for which high-end homes stay on the market is much longer. The inspections would be out-of-date. Once you are in contract, it would be your responsibility to pay for inspections, and in most cases, there are more that are needed on larger estates than regular homes. A properly investigated property is in your best interest!
Thank you for joining us today, and once again this is Dawn Thomas with Siliconvalleyandbeyond.com.
Watch this video, ‘5 Tips in Purchasing a Luxury Home in Atherton and Other Affluent Areas of Silicon Valley,’ and more on YouTube!