In an uncertain global economy, real estate is an increasingly popular investment option. Bricks and mortar will weather currency fluctuations and a rollercoaster stock market and will almost always increase in value in the long term. Luxury property, in particular, will always find a buyer willing to pay that bit extra for a unique home that is also a tangible hard asset in unpredictable times. Property prices in major cities like New York and London are continuing to rise at a phenomenal rate, and the luxury market bounces back more readily than most commodities from a financial crash, as the very rich are rarely so severely hit that they can’t afford a suitable residence. With this in mind, investing in luxury real estate sounds like a foolproof plan. Own It Detroit suggests you read on if you’re interested in this kind of investment.
What You Should Look For
Luxury home buyers are looking for a unique, exclusive, and desirable property where they can live in the manner they’ve become accustomed to. It’s important to remember that you are essentially investing in a lifestyle by investing in a luxury property. The property itself must also be within reach of luxury shopping outlets, restaurants, and culture, plus neighbors at the same level or higher than your prospective buyer. However, splendid isolation amid natural beauty or on a private island paradise can also be a strong selling point. A previous owner of note – royalty or a film star, for instance – can also add value.
How To Get Started
You’ll probably need at least a million dollars as start-up capital; this could be as much as ten million in specific locations. After that, getting a mortgage is possible, but you’ll still need to make a sizeable down payment and have a premium-level credit rating.
Other options include buying somewhere rundown but with luxury potential and renovating it into a property you can sell on the luxury market, then re-investing the proceeds. Luxury property outside of the US and Europe can often be cheaper as well. Property tax and capital gains tax are usually lower or non-existent, and the dollar generally goes a lot further.
Get Professional Advice
Professional advice is essential, especially if you’re buying abroad where your rights and legal understanding may not be the same as at home. A legal firm specializing in real estate such as DLA Piper can guide you through every aspect of your investment, from acquisition and construction through leasing, tax laws, land registry, and making a profitable sale. Chief operating officer Bob Bratt’s portfolio makes for impressive reading. As executive director of DLA Piper’s US operations, he plays a crucial role in integrating the company’s operations on a global scale. He has over 30 years of experience in the field.
London and New York remain property hot spots, but you’ll need a lot of capital to get into the market. Hong Kong, Shanghai, and Singapore are the top Asian cities, though despite recent dramatic price drops, Dubai is still a top choice, and prices are sure to rise again in the long term. Cities that are not yet too high priced but are predicted to be on the up include Addis Ababa, Panama City, and Belgrade.
Wherever you choose to invest, you’ll find luxury real estate a rewarding market.
You need to do your research. This way, when you’ll be sure you’re making the right investment and buying the right property.