What Do Luxury Homebuyers Want?

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By Teresa King Kinney, CEO, Realtor Association of Greater Miami and The Beaches

As a world-class city and top tourist destination, Miami has a booming real estate market that attracts a considerable number of affluent homebuyers. Baby Boomers, along with international and second-home buyers, have increased the demand for luxury homes. A recent Coldwell Banker report indicates that luxury home sales surged throughout the United States last year. Florida was ranked second in luxury home sales after California.

Agents in South Florida who target upper-tier homebuyers require special skills and knowledge to be profitable and successful. Wealthy clients respond to exceptional service and competence in addition to high-quality marketing techniques.

A study by The Institute for Luxury Home Marketing focuses on the demographics of super-rich households: the type of home and amenities desired by the rich homebuyer, his homebuying process, the real estate brands and luxury publications he associates with the luxury home market and his criteria for selecting a real estate agent.

The Profile of Homeowners of Properties above $2.5 million found the following real estate expectations:

When buying property:
70 percent own more than one personal residence (50 percent indicated that their most recently purchased residence was 500 miles or more from their other closest residence)
27 percent own three or more homes
36 percent own other residential real estate as investments
97 percent used a real estate agent
57 percent were very satisfied with their agent
54 percent were very likely use the agent again
17 percent were very unsatisfied with their agent
14 percent changed agents during the property search
65 percent closed on the home within six months of beginning the search
19 percent took more than a year
89 percent purchased a single-family residence

What luxury clients want in a real estate agent:
In descending order, based on the percentage of respondents ranking the trait as “very important” in the decision-making process, the different characteristics broke down as follows:
70 percent value expertise in the luxury home market
67 percent value knowledge about the home buying and selling process
46 percent value previous experience working with the agent
39 percent value resale home product knowledge
36 percent value the ability to be discreet
34 percent value designations indicating experience and knowledge in the luxury housing market
28 percent would choose the agent with the best marketing plan
23 percent would choose the agent with the best listing presentation
22 percent value the ability to use the Internet as a resource and communicate via email
14 percent would choose an agent referred by a family member or friend
14 percent value new home product knowledge
14 percent value mortgage financing knowledge and lender contacts
None would choose an agent because he lives the same lifestyle
None would choose an agent because he is a friend

What luxury clients want in a marketing plan:
89 percent want a listing in the MLS
86 percent want a full-color property brochure
81 percent want a special open house for agents who work the luxury home market
44 percent want an open house marketing event for a targeted group of prospects
53 percent want ads in luxury home magazines and Internet listings with multiple images
61 percent want a virtual tour
31 percent want newspaper display ads
11 percent want newspaper classified ads
17 percent want “just listed” postcard mailings
6 percent want yard signs

It is interesting to note that 42 percent of homebuyers ranked listings with photos as important home-finding resources, while 36 percent ranked listings with virtual tours as important.

RAMB is offering a Certified Luxury Home Marketing Specialist Designation course on June 12 and 13 at The Biltmore Hotel, 1200 Anastasia Ave., Coral Gables, Fla. 33137.

The 12,500-member Realtor Association of Greater Miami and the Beaches (RAMB) includes the Residential Association, Realtors Commercial Alliance and the largest local International Real Estate Council in the nation. RAMB has been serving the industry, public and community for 85 years.

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