Investing in luxury real estate is not just for expanding your investment portfolio. It can also do wonders if you are after growing your money and assets for the long term. Continue reading to learn more about investing in luxury real estate and why you should definitely consider it.
First of all: What’s a luxury property?
It’s common for real estate developers to put the “luxury” label on their projects, which can make things confusing. To help you identify the real thing, four factors are usually tied to luxury real estate: size, location, design, and value.
- Size: Luxury properties do come in a variety of sizes, but the tendency is that the bigger the square footage, the more amenities it can hold.
- Location: Location is a significant driver, affecting a property’s market value. The more desirable the location, the more coveted it will be. Luxury properties in downtown districts, up on mountains or hillsides, or by the waterfront are highly sought after.
- Design: Real luxury properties are usually designed by top architects. The materials and finishing used also tend to be high-quality and expensive. These factors, along with the location and size, further increase a luxury property’s value.
- Value: Luxury properties don’t come cheap and may require a different method of financing. It is common for luxury real estate to be valued over a million dollars.
What can you do with a luxury real estate investment?
Once you have invested in luxury real estate, of course you’re not going to leave it empty. Instead of having it sit pretty, waiting for market factors to boost its current market value, you can generate additional income by doing the following:
- Turn it into a luxury vacation rental: A quick search on Airbnb and other rental sites and you will find a plethora of luxury properties available for short-term rent. This can be especially lucrative if your luxury property is located in a popular tourist or holiday destination.
- Turn it into a long-term rental: Some people would simply prefer renting a luxury home instead of buying one. You can tap into this market. Unlike vacation rentals, long-term rentals can earn you a steady stream of stable income. All you need to do is find the ideal tenant.
- Turn it into a multi-purpose venue: Transforming your luxury property into a multi-purpose venue, particularly for weddings and other private events, can be a great source of additional income.
Before you go with this strategy, however, double-check if your luxury property can accommodate such arrangements and if you can provide additional services.
Interested to invest in Scottsdale, AZ luxury real estate?
The experts at Urban Luxe Real Estate can help you explore your investment options and other strategies in Scottsdale, AZ. Tell us about your real estate goals by getting in touch with us at info(at)urbanluxere(dotted)com or 480.359.6519.
With what you need and prefer in mind, we can narrow down the selection and help you find the perfect luxury property in Scottsdale, AZ to invest in.