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, making it all the more important that the seller put forward a positive image of the home. You have to attract the right buyer, know how to make the buyer understand what makes the home worth the money, and negotiate effectively when selling some of the highest-priced homes available. The right list price and the best real estate agent are two vital cogs in selling a luxury home.
It may seem strange to start a list of the best luxury home selling tips by creating a psychological profile of the end buyer, but it’s not. First and foremost, you want to know who you will be marketing to when drawing in a high-end clientele. With a luxury home sale, you are not always casting the widest net but trying to appeal to a certain audience. Of course, the buyer needs to be able to afford the home comfortably. 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 proximity to a major city, an award-winning school system, the top neighbourhood in the area, or the best restaurants and shops within walking distance? These are just a few examples. There could be many more that apply to your specific home. You and your 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. US News has an excellent article on how to think like a luxury real estate agent. Understanding what motivates a luxury home buyer is important.
One of the most important tips for selling a luxury home is pricing it at the right price 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 sell promptly and for a good price – these are skills that Realtors take years to master.
10 Easy Ways to Break Into the Luxury Market
So, you want to work with beautiful homes and high net worth individuals, but you don’t know how to break through into the world of luxury real estate. Maybe you have tried to farm to luxury homes, but you didn’t get any responses. You probably feel like you are invisible to them. That’s because you are invisible to them.
Or is it worse than that? Even your high net worth friends aren’t using you to sell their plush pads. Instead of listing with you, they sell with another agent who seems to have every luxury listing. What if I told you there are easy ways for you to break into that market?
For the past ten plus years, I have coached agents on how to differentiate themselves so they can attract high-end clients. In this article, I will uncover ten ways to position yourself to break into the luxury real estate market.
Go Where the Local Influencers Are
Reality TV star from “Million Dollar Agent Los Angeles,” Josh Altman, shared with me his story about how he went from a struggling agent to a top luxury agent. Josh explained to me that most Hollywood celebrities live in one specific area of town and that many of them went to the same Starbucks every morning. However, since he didn’t have the same wealthy connections some new luxury agents have, he decided Starbucks could be his intro to the market.
Josh would go to the Starbucks and slowly sip his coffee until a celebrity walked in each morning. As soon as they got in line, he would toss out his coffee and jump in line behind them. Then, pulling from the local celebrity buzz and his knowledge of the Los Angeles (LA) real estate market, Josh would spark up a conversation.
He would say things like, “I hear you are working on a new movie with (so and so)” or “Have you heard that (so and so) may be selling their estate? I think it would be perfect for you.” Josh was just hoping that they would converse back and that he could find a way to provide value to them, so they would think of him if they had real estate needs.
Find a place in your area where you will strategically “bump into” the rich and famous. Every city has businesses, areas, and hangouts that the affluent frequent. This may be a country club, bar, gym, or even a Starbucks in your area. Choose a post and figure out how to become a figure there.
Once you have identified where you will spend time waiting to bump into wealthy homebuyers and sellers, you must consider how you will approach them. Desperation is not an attractive quality, so don’t chase wealthy people around asking them if they want to buy or sell a home. You want to attract, not chase.
Prospect Luxury Expireds
Traditionally, luxury homes can take two to three times longer to sell than the average home. This is because there are fewer people who can afford the high price tag associated with luxury. Additionally, due to the custom nature and unique features that many luxury homes contain, they are much more difficult to price the first time correctly.
Because of this, luxury home listings expire more frequently than moderately priced homes. Some luxury listings can sit on the market for years and change listing agents two to three times before selling. You don’t necessarily need to close your first listing to get started—you just need to get it, and more will follow.
Luxury FSBO sellers can also find it difficult to attract “real” homebuyers for their premium-priced homes. However, this means that there is an opportunity for some savvy agents to prospect for both luxury expireds and FSBOs.
I have coached several agents on how to get listings by prospecting expired luxury listings and FSBOs. While the scripts to get the appointment are the same, your positioning and presentation are slightly different from a traditional listing.
Solve a Specific Problem Common to Wealthy People
Have you heard the saying, “When you try to be everything to everyone, you’ll only be nothing to anyone”? This is also true when communicating with wealthy clients. The affluent are busy, and sophisticated and polished companies are constantly marketing to them. Therefore, your marketing must stand out, and it must be great. Unfortunately, the elite doesn’t have the time or the energy to pause and think about how you “fit” into their lives.
When you are clear in your marketing and in your messaging about exactly what problem you specifically solve, then they can quickly decide if they need your services or not. Doing this also differentiates you from the other real estate agents you are competing with. Here is a shortlist of common problems to wealthy people you might think about solving, along with your general real estate services.
Create a Course & Become an Authority (& Have Great Snacks)
When you think of the wealthy, you often think of highly educated people. But, of course, your wealthy clients are likely well-educated, so what could they learn from you? Well, they may be well-educated, but not likely in real estate.
Real estate is a specialty, and there are more specialty niches within the real estate industry. So if you want to start working with luxury leads, then you need to educate yourself and find ways to pass that knowledge on to them.
If you are like me, you may be a teacher at heart. Selling through educating has always been my go-to lead generation strategy. When you take the time to educate, they will see you as an authority, and this will gain their trust. High net worth individuals may desire a deeper knowledge of real estate investing, 1031 Exchanges, recent zoning changes, or development opportunities. Still, you need to do more than knowing your local real estate
listing a specific problem or challenge wealthy people commonly face and create a course to educate them on how to solve it. Your goal is to become the local authority on the subject.
Leverage Your Past Expertise
If you want to know exactly how to become a luxury real estate agent, do what many other luxury agents have done: leverage your past expertise. Like you, many top luxury agents had careers before they began selling real estate. The only difference is that they leveraged the expertise from their previous careers to attract luxury buyers and sellers.
Previous professional careers like an attorney, CPA, or financial planner are perfect careers to pivot into working with affluent clients because some well-heeled clients expect their agent to have deeper knowledge and understanding when it comes to things like risk management, financials, and tax liabilities.
Experience in other related fields, like interior design, architecture, or construction, can also help position you as the expert in preparing a luxury property for sale or helping construct their dream property.
Reflect on your career and experiences prior to real estate. Then, ask yourself the following questions:
“What experiences, skills, and knowledge could be seen as valuable to a luxury client?”
“What types of luxury clients would benefit from my previous experience, skills, and knowledge?”
“How can I communicate this in my marketing, conversations, and advertising?”
Get a Hobby That Rich People Participate In
One of the greatest challenges of being wealthy is where to spend all your money and your free time. The rich have access to more expensive hobbies and hobbies that take more time to master than the rest of the working class. Therefore, where you find expensive or difficult hobbies, you will find upper-class clientele.
If you wish to rub elbows with the rich and famous, it may be as easy as joining your local polo club or attending a few fine art shows. However, remember that nobody likes a poser, so start with a hobby you actually know or at least some interest in.
While buying a horse or race car might not be feasible for you, you can always find other ways to get into the hobby as an enthusiast. For example, you may not be able to afford a Ferrari, but you can certainly educate yourself on the company’s history and attend meetups and car shows to show off your knowledge.
You can turn this from entertainment to an opportunity by being prepared. If you are attending a vintage car race, you can bring a list of luxury properties in your area that feature large garages or outbuildings that would be perfect for vintage collector car storage.
Get Involved in Charities & Causes
The high-society lifestyle includes the responsibility of supporting causes. The affluent do this by attending charity events and auctions, volunteering, and fundraising.
Their personal interests may support local and national charities, local schools and alumni events, and local and national political candidates. Find a cause that you also care deeply about and get involved. No need to do this just for the expectation of meeting high net worth individuals; this strategy has the additional benefit of making you feel good about helping others.
Start with causes you are passionate about. When your compassion for the cause shows through, your relationships and opportunities will develop naturally. From there, you will build relationships that will lead to opportunities.
Level Up Your Designations
You may wish that you were born into the luxury lifestyle. You may even believe that if you had been, it would be easier to get luxury listings. Having an elite pedigree may get you access to affluent people, but it doesn’t automatically earn you the right to handle your peers’ multimillion-dollar transactions.
Your social circle will want to know that you have the real estate acumen before they trust you with their most prized possession.
If you choose to become a respected luxury real estate agent for the wealthy, you must prove that you have the knowledge, skills, and experience to handle such an expensive asset.
You can gain knowledge by seeking a degree in real estate or your GRI (Graduate, Realtor Institute). Then, boost your luxury home sales techniques by earning a designation from the Institute for Luxury Home Marketing.
You can also gain skills by helping other luxury agents with their marketing, events, and open houses. Once you get a few leads, you can gain experience by getting a few sales under your belt. It will snowball from there.
When you are able to show your well-to-do peers that you are committed to being the best luxury real estate professional you can be, they will be more likely to take a chance on you.
Make Luxury Part of Your Personal Brand
Recently I talked to my friend, the founder of Luxor Lifestyle magazine, Jessica Peterson, and she shared with me her secrets to breaking into the luxury real estate market. FAST. Jessica said that to break into luxury real estate, your marketing needs to show more than anything else that you know your stuff and that you are in the community.
According to Jessica, affluent clients want to know specifics about your marketing plan and marketing efforts. She continues, “Videos are key right now … about the lifestyle. They want to know about the lifestyle.” This suggests that you can market yourself with videos around the lifestyle of living in the community.
Dig deeper into Jessica’s unique perspective of how she broke into luxury real estate in the interview with Jessica below. In addition to talking about integrating luxury into your personal brand, she also shares what never to do as a luxury agent.
Don’t Market Listings, Market the Lifestyle of a Wealthy Area.
Affluent people often own multiple homes located in areas that offer unique lifestyles. First, attract the attention of luxury home buyers by showing them what their life would look like if they lived there. Then, create a plan to consistently market yourself as the luxury lifestyle agent in your area with a high-quality website, strong social media presence, and targeted landing pages.
Whether you are near the beach, mountains, a lake, or the hip urban hub, you can share the best of the luxury lifestyle from that area. Using your social media accounts, also won’t cost you a lot of money to cover high-end restaurants, gallery openings, or golf tournaments. Social media is the perfect place to “fake it until you make it.” As a result, marketing the luxury lifestyle is easier than ever before.
Once a month, hire a photographer to take professional photos or videos of fine local dining, theatres, museums, recreation, luxury stores, and, of course, luxury homes.
You can also follow restaurant openings, gallery openings, and so forth on social media and give them some coverage. They will love you for the free press.
Create a schedule to post your professional photos on Instagram. Add a hashtag for the location and the feature you are promoting (#lajolla #beachfront).
Lastly, don’t forget a call to action. “Message me if you want to live on the beach!”
4 Steps To Land The High-End Buyer You Deserve
Learning how to find luxury homebuyers for high-end properties is not all that different from doing so in your average suburban neighbourhood. Just about every step in the selling process can be applied to low-end homebuyers, high-end buyers, and everyone in between. However, there are subtle differences that, when not accounted for, can cripple high-end sellers. That said, the most important aspect of finding homebuyers of the high-end variety is to understand their inherent wants and needs. Not only that, but you need to be able to tell them you have what they are looking for in a way that separates you from the average home seller. It’s your responsibility to provide them with an experience (and a home) that they can’t get anywhere else. You will notice that selling a home in a high-end community isn’t impossible if you can do that.
The Devil Is In The Details
Understanding how to find luxury homebuyers has just as much to do with minute details as it does with obvious marketing strategies. Unfortunately, in marketing a luxury home, far too many investors are unaware of one crucial step: the easiest way to convey the highest perception of quality is to offer prospective buyers the most intricate details. If, for nothing else, you aren’t doing enough to separate your high-end home from those that have been deemed “average” unless you mind due diligence and give every aspect of the home the attention it deserves. Everything (no more, no less) must be given an inherent degree of attention when trying to sell a luxury home. Namely, every aspect of the property — from the amenities to how you present them — must be noticeably refined.
Of particular importance, however, is the manner in which you market your luxury home. It’s not enough to simply touch on the aspects of the home you feel people will find the most appealing; you really need to sell them. The more you can do to illicit an unabashed sense of luxury, the better. Remember, you don’t simply have a fireplace; you have a grand, ornamental hearth. How you convey your message is just as important as the message itself.
Outside of marketing, you need to stage your property accordingly. Not only does every detail need to be immaculate, but the simple act of staging a luxury home must suggest no expense was without reason. Every move you make must be calculated and serve one purpose: to place the property’s best foot forward.
Never Cut Corners On Marketing
I am convinced that perception is everything when finding homebuyers for luxury properties. That said, no expenses can be spared when trying to capture the attention of your higher-end audience. You not only need to invest in the highest quality marketing materials to make the right impression, but you need to present them in a way that homebuyers will appreciate. It’s not enough to simply place an ad in the local newspaper; you have to create expectations by going above and beyond.
First and foremost, individual photos of a high-end property must be of the best quality. It has been said that real estate photography can help a home sell faster and for more money, and luxury real estate is certainly no exception. It’s absolutely in your best interest to hire a professional photographer who can highlight your homes best features and turn them into “eye-catching” selling points. Despite how far camera phones have come in a matter of years, avoid posting any photos you have taken without the appropriate care they deserve. Remember, photos will be one of the first things to attract buyers to your property — make them count. If for nothing else, poor photography can scare away buyers just as easily as good photography can attract them.
However, it’s worth noting that photography isn’t the only marketing aspect high-end homebuyers will scrutinize. The writing that compliments the photos is equally as important, if not more so. Unless you aren’t fully capable of writing a compelling marketing campaign on your own, I would advise enlisting the services of a professional marketing writer. Even the slightest omission or typo can leave prospective buyers with a bad taste in their mouth. Don’t give them any reason not to step foot in the property before they even see it in person; hire a professional content writer.
Understand Who You Are Selling To
Few things—if anything at all—are more important for learning how to find luxury homebuyers than understanding your specific audience. Luxury real estate leads will turn into unique opportunities. You can’t sell a home if you don’t know who you are selling to. Only once you have an idea of the audience you will entertain can you begin to tailor your marketing efforts and meet their specific needs. That said, a luxury homebuyer profile will shift from client to client. As a result, learning how to sell a million-dollar home will also require investors to adapt to each client they encounter.
The most effective marketing strategies have become synonymous with a deep understanding of the fundamental needs of those you intend to serve. Today’s greatest marketers know it, and so should you: there is no way you can possibly hope to sell a high-end home unless you can speak directly to your audience. It’s only in offering them what they want to hear that your efforts will be met with success.
Mind due diligence and uncover what it is your buyers want most. Do your homework and scout out nearby comparables. What features do they have? How was the home priced? Perhaps even more importantly, how fast did it sell? And, last but not least, what can you do for the same results?
Price It Accordingly
Not surprisingly, finding homebuyers in the market for a luxury property isn’t all that different from any other interested buyer. While those looking for high-end homes may have a little more disposable income than the average person, it doesn’t mean they aren’t going to covet a deal. It’s worth noting that you can’t save up a lot of money if you play fast and loose with your savings. That said, you can’t simply slap an extravagant sticker price on your luxury home and assume anyone is going to be willing to pay top-dollar for it. No, you have to be strategic. Not unlike everyone else, high-end homebuyers will want to take advantage of a bargain or at least feel like they are getting a good deal.
Instead of pricing your home too high, I recommend going in on the slightly less expensive side. One of the best luxury real estate marketing ideas an investor can use is a lower price point; it’s that simple. While you don’t want to completely eradicate your bottom line, you may find that it’s possible to sell your home for more by asking for less. How? The answer is relatively simple: competition.
If you can offer your home at an attractive price — one that catches the attention of numerous prospective buyers — there is no reason to suspect you won’t receive multiple inquiries. After all, everyone wants a good deal on real estate in today’s economy. So if you can generate that interest by offering a slightly lower price than the property is actually worth, you may be able to generate enough interest to spark a bit of competition. Provided you have several interested parties, and it’s conceivable that they will compete with each other and drive up the price while you sit back and watch the offers come in.