How to Acquire a luxury Home

There is not one design, style or size that embodies a luxury home. It could be a sprawling 15,000-square-foot mansion set on several rolling acres, or it could be a 4,000-square-foot contemporary home nestled into the side of a mountain. Although it’s difficult to quantify exactly what luxury means, most buyers think they know it when they see it.

Across Nigeria, sales of luxury homes have been hitting records with people appreciating the need for unique architectural designs as regard their homes.
Prices for luxury real estate have also seen significant increases over the last couple of years as the demand for it increased.

Why the Growth?

It may seem incongruous that luxury markets are heating up, due to the hospitable nature of Nigerians and the desire to leave comfortably. Like the financial markets, the real estate  market operates under the law of supply and demand. In the past and by nature, there were a limited number of luxury homes for sale at any given time in a particular market resulting in limited inventory driving up prices as multiple buyers bid on a single luxury property.

Buying a Luxury Home

According to the 2013 Profile of Home Buyers and Sellers published by the National Association of Realtors, nine out of 10 buyers used the Internet at some point when looking for a home, and 43% of recent buyers first found the home they purchased online.

While the vast majority of home buyers rely on the Internet at some point during their home searches, luxury home buyers can be at a disadvantage when it comes to finding properties online. Many high-end properties aren’t listed on MLS or search engines. And, in order to protect their privacy, many sellers avoid putting information and photos of the property on the internet.

Find a Qualified Real Estate Agent

If you are in the market for a luxury home, a qualified real estate agent who knows the luxury market may be your best bet for finding properties that are for sale but that are not necessarily easy to find because of privacy concerns. An agent familiar with the luxury market may have inside information about listings before they hit the open market. And, an experienced agent will be able to help you determine the market value of a luxury property. Most residential real estate is valued using comparables – similar properties in the area that have recently sold. Valuing luxury properties can be a challenge since often there are no similar properties in the area.

Financing

The loan process for luxury homes typically takes longer than for smaller mortgages. Even if your financials are in good order, it may take 45 to 60 days to secure a loan. Since it can take extra time, and because the seller of a luxury home is often interested in showing only to qualified buyers, many real estate agents recommend having your mortgage broker, loan officer or personal banker obtain your financing approval early on in the process.

Due Diligence

As with any real estate purchase, it is important to take the time to properly inspect a luxury home prior to purchase. In many cases, luxury homes are larger and have amenities that may require specialized home inspectors, such as:

Pools and spas
Fountains and ponds
Lawn irrigation systems
Exterior fireplaces
Automatic screen and awning systems
Central vacuum systems
Heated floors/driveways
Sophisticated security/surveillance systems
Landscape lighting

The Bottom Line
The luxury home market has experienced record growth in the last several years. Much of the growth is due to an awareness of owning such homes. Its a very good avenue to improve economic growth.