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Defining Luxury

by admin

BY K.K. SNYDER

Today’s luxury homebuyer is as discerning as ever and closing those mega deals takes a lot of hard work, work that many in the industry just aren’t willing to tackle. But for those who do excel in Miami’s luxury market, the rewards can be monumental in terms of both income and personal satisfaction.

Things are always changing in the Miami luxury market, including the very definition of a luxury home. For the most part, properties priced at one million and up used to be considered luxury properties, a price line that varies widely depending on location, of course, but which is harder to define in the Miami market.

“If you’re going to benchmark a property for one million, that is not luxury,” says Albert Tamayo, a Realtor with The Jills of Coldwell Banker. “It’s hard to define what price luxury is. Is it a $20 million property versus a $2 million property on the same island? Other waterfront properties are $2 million or $2.5 million but are a lot smaller. It’s unfair to base luxury properties on monetary value alone.”

Instead of using price to determine whether a property is considered luxury, finding that definition in today’s market is about buyer expectations. According to Penni Chasens, an agent with Cervera Real Estate, in Miami, luxury typically means waterfront property, a nice size lot or a ready-to-move-into home with nearby amenities.

As a 13-year veteran of the luxury market, Chasens says about 75 percent of her business is in the luxury condo market and the other 25 percent comes from single-family homes and commercial property.

“For luxury, waterfront is always standard. Location, great views, keeping up with modern ideas and innovations. Luxury is always luxury. And, yes, it’s always improving with time. And, yes, the price continues to go up. The most important thing is location. The second important thing is the developer. People will definitely follow an excellent developer.”

What goes into a luxury home, however, can still be defined by dollars, big dollars. Elevators, wine cellars, media rooms, custom lighting, flat screens in nearly every room and furniture grade custom cabinetry – most have come to be expected by today’s luxury homebuyer. Kitchen standards include multiple commercial kitchen appliances such as two or even three dishwashers, built-in cappuccino and espresso makers, Sub-Zero refrigerators, double ovens and separate freezers, all from top-of-the-line manufacturers including Wolf, Viking, Thermador, Five Star and Bosch.

Likewise, luxury homebuyers expect the finest finishes, including exotic woods, marble and granite, custom woodwork, wide plank flooring, custom solid 8- or 9-foot doors and high-end hardware such as pewter and satin nickel. There is a lot going on with tile and stone in today’s luxury home, as well as new metallics and incredible porcelains.

Exterior finishes are every bit as important as interior in luxury homes these days, with more combinations of mixed materials such as brick, stone, stucco, iron and woods requested by the luxury homebuyer.

Amenities aren’t relegated to the interior of these homes, either, as outdoor living space continues to gain in luxury as well, from complete kitchens and dining areas to grand outdoor fireplaces and rooftop swimming. Being on the water makes boat docks and other water sport amenities a frequent request as well. And near the top of every luxury homebuyers’ list are privacy and security, says Tamayo, including a gate system, cameras and other technology.

“Buyers want to know what amenities there are within a two to three mile radius, like proximity to an airport, fine dining, theater and things like that,” says Tamayo, whose top sale to date was a $19.9 million property. “They want straight beach access, amazing views, exquisite property and a well-appointed home.”

Like many of her peers, Chasens has recognized a shift in the demographic of today’s luxury homebuyer interested in the Miami market.

“With the downturn of the dollar, even though we had a lot of European buyers before, I think now we’re attracting more Europeans and dealing with a lot of Middle Eastern and Asian clients, buyers from India, Hong Kong, Singapore and even surrounding Islands in the Caribbean. I think a lot of people have piqued their interest because of the value of the dollar,” she says.

Likewise, Tamayo has noted a demographic change as well. “The big difference is a new breed of luxury property buyers. There is new money out there and the global market has broken down all the walls and we’re getting new buyers from all over the world. We’re seeing the nouveau riche, new oil monies, as well as the old money coming through,” says Tamayo.

Though some believe size is coming down in new luxury homes, there are many luxury homebuyers who still request homes in the 7,000- to 11,000-square-foot range, all designed and constructed with attention to detail, something that goes above and beyond the norm. Buyers routinely request grander rooms, custom fireplaces, master bedrooms with large walk-in dressing rooms, huge master baths, touch pad sensors to control the home’s extensive electronic features through the computer, radiant heat even in garages and lower levels, four to six separate heating and cooling zones and high-tech security systems with cameras.

“It’s all in the details,” offers Gabriel Garay of Lark Construction, which constructs between one and three luxury spec homes each year in areas such as High Pines, Ponce-Davis and Pinecrest. “The finishes are even more important now. And I don’t think you can judge luxury by the square footage now that the market is saturated with the McMansion idea. You can have a small luxury home with all the bells and whistles of a large luxury home,” says Garay.

Millwork, Garay points out, is a big detail these days. Whereas older homes might have a single crown molding, today’s luxury homes often have triple crown molding or baseboards. And while Carrera marble used to be considered “an uber-luxury” amenity in a home, today marble is standard.

“To say you have marble floors is like saying you have a roof,” says Garay. “The idea behind our houses is to give buyers the most ready-made luxury houses ready for them to put their personal touches in and move in. Every buyer is different, but nobody wants to pay $2 million-plus for a house and have to still put out a bunch more money to get it ready to live in.”

A frequent request in luxury homes these days is Smart Home technology that enables homeowners to use a computer to control heating and air conditioning, lighting, security and communication systems.

Taking the technology a step further, many of Chasens’ luxury condos include an in-residence touch panel called Epic-Link connections, which allows homeowners direct access from any computer to the concierge, valet, room service and other options.

“Developers are very savvy and as things advance, the developers are on the ball to upgrade their product and new buildings are coming out with the latest technology,” says Chasens.

Some luxury property buyers have discovered the convenience and added amenities available in a community setting, such as that at Canyon Ranch Miami Beach. Developer Eric Sheppard with WSG Development describes the project as a “healthy residential community dedicated exclusively to promoting and fostering a luxurious, healthy lifestyle,”

“Buyers are seeking something more than just nice amenities; today’s luxury buyers want a life around them,” says Sheppard. “Canyon Ranch will have restaurants [and] the largest spa on the East Coast featuring the country’s first European-inspired thermal spa.”

In addition, the property also offers 70,000 square feet of leisure and lifestyle space with fitness and spa facilities, plus a Canyon Ranch Health & Healing Center that will offer preventive medicine and wellness services. And much like the Epic-Link in many of Chasens’ condos, buyers at Canyon Ranch will have 24-hour contact with the concierge for everything from laundry service to grocery shopping requests.

“The project blends the 24-hour service of a hotel with a condo on top of the complete life-enhancing community offerings,” says Sheppard.

Representing luxury homes takes a special knack in terms of knowing how to market them and to whom you should market them. Often it’s the face-to-face opportunities that come with playing host to a variety of events designed to draw potential buyers – wine tastings, parties, entertaining clients one-on-one, big Realtor and broker open houses – that are useful in highlighting a property or your expertise in the luxury home market. These are the best ways to really spark interest and help build relationships with clients.

“Luxury is a sector of the market that keeps getting stronger and stronger,” says Chasens. “I don’t believe the little downturn we’ve seen in the market has affected the luxury market a great deal.”
Tamayo agrees and says his company is just as busy now as in 2006 and 2007.

“Luxury homebuyers are immune to some of the slow down with the economy and the real estate market,” he adds.

Keeping up with a booming luxury market takes a lot of work and most luxury homes take a great deal of time to market just by virtue of their price. Unlike lower-end properties in which a lockbox allows other agents to show the home, listing a luxury home takes a major commitment. The listing agent must learn the house and everything about it and be present at each and every showing to provide information, even if another agent is showing it. Another major difference in the luxury home market is that appointments must be made to show the home, something demanded by both the seller and the buyer.

Realtors in the luxury market typically look at each property individually and develop a custom marketing plan for that specific property. Marketing efforts are often concentrated first among peers, such as other agents in the luxury home market. Efforts then spread to direct marketing to mailing lists, quality brochures and Internet marketing as well as advertising in select magazines published especially for the luxury home market.

“Like in any other market, you have to know your stuff; know your product, listen to your buyers, be very accessible and be very service oriented,” says Chasens, who gets a lot of business through referrals.

“You also have to stay on top of the market by being very Internet based,” continues Chasens. “I have to have my properties out there in cyberspace so I can reach buyers anywhere in the world. This is not a local market; it’s an international market we’re appealing to right now.”

Resources:

Penni Chasens
Cervera Real Estate
305.374.3434
[email protected]

Gabriel Garay
Lark Construction
305.491.6770
[email protected]

Eric Sheppard
WSG Development
305.673.3707
[email protected]

Albert Tamayo
The Jills, Coldwell Banker
786.556.9713
[email protected]

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