What It Takes to Sell a Luxury Home for Maximum Return.
Today’s seller's market environment has made selling quite a bit easier than several years ago. But, if getting maximum dollar for your real estate is important, you must do it right.
Considering the value of luxury homes, it is understandable that sellers would want to get things right. These homes are substantial investments, often worth millions of dollars. There are fewer luxury homes out there, which makes it even more important that the seller put forward a positive image of the home. You must attract the right buyer, know how to make the buyer understand what makes the home worth the money, and be able to negotiate effectively when selling some of the highest-priced homes available. Having the right list price and the best real estate agent are two vital cogs in the sale of a luxury home.
#1 Create a Psychological profile of the buyer.
It may seem strange to start off a list of the best luxury home selling tips with creating a psychological profile of the end buyer, but it is not. First and foremost, you want to know who you will be marketing to when trying to draw in high-end clientele.
With a luxury home or property sale, you are not casting the widest net but trying to appeal to a certain audience. Of course, the buyer needs to be able to comfortably afford the home. The last thing you want to be targeting is those who are marginally qualified.
But what exactly are you selling? Beyond the magnificent architecture of your property are you selling an award-winning golf home, a top school system, a highly desired gated community or the best restaurants and shops within walking distance? These are just a few examples of presenting 'lifestyle' to your potential buyer.
You and your luxury real estate agent need to have a strong grasp of what separates your home from other luxury properties in the area and market to those strengths. Conversely, you must also understand the challenges and provide a simple solution to meet those needs. Notice we didn’t say “hide” those challenges.
#2 Price it correctly.
One of the most important tips for selling a luxury home is pricing it at the right place from day one. Pricing any home correctly is challenging. Knowing how to look at a home, measure its strengths and weaknesses, compare it to similar homes, examine the surrounding market and price it to both sell in a timely manner and for a good price – these are skills that great Agents take years to master.
Luxury homes add another layer of difficulty when it comes to pricing. There are less comparable homes to reference, and each luxury home tends to have unique features that only some buyers will value. These features often make the property more difficult to price.
Some inexperienced agents will try to use rudimentary price per square foot. This is a sure-fire way to get a luxury home priced wrong! There are significantly more challenges to pricing a luxury home than say, a moderately priced one. The price, however, needs to be spot on if you want to get top dollar as we know total days on market, decrease the property’s value. Price a home too high, and it will sit on the market for months without selling. Eventually, it will develop a stigma – buyers will assume there is something wrong with it. We know from research that every day a home is on the market, it loses value.
This is especially true with luxury homes, because with such a smaller supply, buyers and their agents are unlikely to forget about the home. They will recognize it, even if it pops up a year later at a lower price. Also, luxury buyers are not the same as those at other price points. Their needs, wants and approach to buying is much different. If an agent tells you they list all homes the same, they probably don’t understand this difference.
Pricing the home correctly is one of the biggest reasons to hire an agent familiar with luxury properties. The agent should understand the difference that location plays in the comparable sales data and how one neighborhood and even one street differs from the next. The neighborhood in which a property is located can have a huge influence on value. Other items, especially in Flagstaff are views, proximity to walking and running trails, forest access etc. All of these should be approached with a premium in pricing in mind.
A skilled luxury real estate agent understands all the factors of a home. Great agents know that comparable sold properties are vital to establishing true market value. They don’t waste a lot of time looking at homes sitting on the market that have not sold. Knowing how to sell a luxury home starts with accurate pricing.
#3 Good timing.
Flagstaff and many other second home markets can be very seasonal. What does this mean? Many buyers are looking to get away from the Valleys heat. We also see buyers from Las Vegas and California looking for that perfect home in the perfect environment. Our task: create it. Understanding market trends in specific locations is critical.
Other timing factors could include political elections, interest rates, growth indicators of an area, social issues, stock market prices, inflation trends and much more. Time it right, and you will be rewarded.
Another aspect to timing is understanding how long your property has been on the market and when to make changes. Changes could be price. But they could also be changes in marketing, taking new photos and being able to talk about the property depending on what season it is.
#4 Effective marketing.
When selecting a real estate professional to sell a luxury property, it is critical to have one that understands luxury specifically. From market knowledge and preparation to pricing, advertising, and branding, a luxury property demands the attention it deserves. Your ‘Luxury Agent’ should be able to articulate the differences while also producing a plan to meet those unique needs. This is the ONLY way to achieve maximum results. Remember, luxury marketing and branding is very different from other real estate sales.
Have you seen your properties advertising? Was there any? Has your agent clearly shown ROI and impressions on those ads? Is there a clear and obvious strategic plan to selling your property for the most amount of money, in the least amount of time? It is a fact that most agents do not spend the advertising dollars needed to sell luxury real estate to its fullest potential.
Finding the right buyer requires getting the word out about the property for sale. Today the primary marketing channel is the internet but putting up a listing on the multiple listing service (MLS) is not enough to sell a luxury property. At least, not for maximum return. You want your property in front of potential buyers that didn't even know they wanted to buy. That means getting many more impressions outside the MLS. Luxury buyers have an advantage in that they can often buy a new property when they wish. We capitalize on this advantage by presenting amazing real estate to them outside of traditional means.
Marketing correctly should be very strategic. In addition to pricing a home, a reputable agent will have many marketing options for your luxury home. The first will be online, but the most pervasive will often be the network he or she has with other Realtors, past clients and other people involved in high-end real estate. Top real estate agents understand the best marketing routes for selling a home and they take advantage of them all. Exceptional agents leave no stone uncovered when selling a high-end home. Internet, print, social media, texts, emails, and many other mediums must be considered in a truly complete marketing plan.
Our proprietary 'Strategy Statement' meets these needs and much more. It is the absolute most comprehensive marketing plan in the Flagstaff area. Guaranteed.
#5 Property Preparation.
Investing some time and effort up front to prepare your house for showings will generally increase the likelihood of receiving offers soon after you list your home. The longer your home stays on the market, the harder it can be to sell. Normal wear and tear can add up, especially if you’ve lived in your home for a long period of time. From a door that squeaks to a window that sticks or a toilet that runs until you jiggle the handle, it’s easy to ignore minor issues that seem like quirks. Buyers, however, may see these quirks as problems that lower the value of your home or as bargaining chips during the closing process. If you have too many noticeable repairs, buyers may also wonder if more serious issues lurk below the surface, and that could prevent them from making a good offer.
Big kitchens, bathrooms and storage tend to be big selling points so it can help to make your rooms look as spacious as possible. Professional home stagers recommend that you remove 50% of your items. Decluttering also includes furniture. The scale of your pieces should match the size of the room, and buyers should be able to easily walk around spaces without bumping into furniture. Make sure furnishings don’t block doors, windows, or architectural features. In a small living room, for example, consider removing end tables or accent chairs. Such moves aren’t convenient, but remember, they’re temporary.
In addition to cleaning and decluttering, you should consider depersonalizing your home. The goal when selling is to have a buyer fall in love with your house, picturing themselves living there and imaging their belongings inside. That can be difficult if your home has your personal stamp all over it. Neutralize the space by removing items such as family photos, souvenirs, religious symbols, diplomas and certificates, hobby supplies, mounted animals, and collections, including CDs and DVDs. You don’t want a buyer to feel like they’re intruding in your space or, worse, take offense at your lifestyle.
A fresh coat of paint can make a home feel new. In fact, painting is one of the most common recommendations real estate agents make to sellers before they list. Paint can help small rooms appear larger and highlight architectural details, such as crown molding and trim. Be mindful of your color choice, however. Experts recommend warm neutral colors, such as beige, tan, gold, gray, and “greige,” a blend of gray and beige. Because these shades go with anything, they can help buyers to picture their belongings in your home.
Now comes the final step: staging your home. The goal is to create a great first impression so that buyers put your home at the top of their list. On average, staged homes sell 88% faster and for 20% more than those that aren’t staged, according to Realtor.com. You don’t need to stage your entire home. Focus instead on rooms that impress buyers most, such as the kitchen, living room, master suite, and bathrooms. In the kitchen, for example, place a bowl of fresh fruit on the countertop and set the table with beautiful dinnerware and linens. In the living room, toss a decorative blanket on the arm of the sofa and add a vase of fresh flowers to the coffee table. Update bathrooms with fluffy new towels and display a dish of decorative soaps. Put a tray with a book and teapot on the edge of the master bed. Create a single focal point in each room, hanging a simple piece of artwork that enhances your staging, or highlighting architectural details, such as a fireplace or beautiful windows.
Once your home is ready to sell, the trick can be maintaining that level of repair and decoration. Showing requests can happen at a moment’s notice, and you won’t always have time to ready your home. Create a cleaning schedule and stick to it. Control of clutter by putting things away when you’re done using them. Enlist the whole family, so the responsibility is shared. Make a habit of wiping kitchen and bathroom fixtures and surfaces daily. Keep wastebaskets emptied. Vacuum or sweep before you leave the house. Mow your lawn and remove weeds every week. Keep your walkway and porch clean and accessible.
#6 Effective offline marketing.
While online marketing is a critical part of selling a luxury home so is your non-digital marketing material. There should be additional money invested into marketing material when marketing a high-end home. Perception is everything when it comes to marketing to buyers who are purchasing an expensive home. The material should tell a story both about the home as well as the city or town the property is located in. Selling such things as the neighborhood or outstanding education are all part of the puzzle. Often you are selling a lifestyle, and this should be conveyed in the marketing material. Keep in mind that many luxury home buyers look for well-known luxury brands. This should be reflected in your marketing. For example, in the kitchen, high end appliances include a Sub-Zero fridge, a Wolfe or Viking stove, a Thermador oven, a Miele or Bosch dishwasher. Luxury buyers look for these brands. When marketing the home these things should be emphasized. The kitchen is often the most important room in the house so extra time should be spent featuring it.
#7 Traits of Luxury Home Real Estate Agents
When marketing and selling a luxury home, the agent you select becomes even more critical. The agent you hire will be your voice in getting the word out about how magnificent your property is. When done correctly, this elevates the sales price considerably.
Some of the most important traits of a luxury real estate agent include:
Amazingly effective communicators.
Extremely detail oriented.
Understands luxury home market preparation.
Understands the local, national, and international markets.
Experts in marketing, branding, and advertising.
Have a good sphere of influence.
Skilled in problem-solving.
Pro negotiation skills.
Understanding of wealth management in real estate.
Wow, that can be a lot. These skill sets are unbelievably valuable when selling a high-end property. At least if getting top dollar is important to you. Keep in mind your real estate agent plays a vital role in the sale from start to finish. Also keep in mind, your agent will more than pay for him/herself with higher sales results. Each aspect of the transaction is important whether it is communicating with you, the other agent, contractors, title/escrow or solving problems that comes up in the sale. Selecting the best real estate agent is one of the most important tips when selling a luxury home. You want the best on your team.
For much more on luxury home branding for maximum results, contact us today for a free consultation.