Some people want to buy a luxury apartment because they see it as the best way to reward themselves for a lifetime of hard work. Others because they want to invest their money in something that could be worth more in 10 years. And sometimes, because they want to live in comfort. No matter what makes a luxury property stand out for you, you’re right to find it appealing. An upscale apartment in a good area can be an excellent investment for you and your family, but before you sign those papers make sure you base your decision on clear benefits, not fancy edited photos on the seller’s website.
A luxury apartment can be worth the high price tag, but sometimes the property isn’t as impressive in real life as it is on paper. Even if budget isn’t a problem for you, you should still know the difference between a luxury condo and an overpriced one to make the most out of your investment.
Check the evolution of the local market
One of the biggest mistakes you could ever make when purchasing luxury property is choosing a location that you don’t know too well. That doesn’t mean you should never seek to branch out, but insider knowledge is needed if you want to avoid common traps. For example, the neighborhood is trending now, but did you check the forecast for the following ten years? What infrastructure developments are expected soon and how will they influence market prices for the long term? If you are thinking of purchasing a luxury apartment in Europe, Geneva, Monaco, and Paris are great locations you can’t go wrong with, but at the same time, you can also look at emerging markets such as Zagreb in Croatia or Rotterdam in the Netherlands. In the US, it might not be a good idea to purchase property in large cities like San Francisco and New York, experts say. The reason? Inflated prices. Instead, invest in luxury condos in smaller cities like Scottsdale. The facilities are 5-star, but the prices are considerably lower compared to big cities.
Get a building report
Luxury apartments usually have a large marketing budget. You’ll see them in fancy catalogs and the photoshopped images will take your breath away. But don’t buy an apartment just because it looks great in perfect lighting. Photographed by an expert, even a college dorm room can look appealing. Instead, look at the apartment with a critical eye and ask for a thorough building report. In it, you’ll see exactly what you are getting for your money and what issues you can expect in the long run. Look at details such as the moisture testing, the quality of the exterior paving, the durability of the building foundation or the last time when it was restored. Was the company that restored the company a prestigious one? Small things such as bathroom fixtures and window handles are also great indicators of how much an apartment is actually worth.
Visit the area at different times of day
If you loved the apartment at the first viewing, make sure you schedule the second one at a different time of day. Unpleasant surprises don’t happen all the time, but sometimes you may see things that you don’t like. For example, maybe the apartment building is close to a kindergarten and there’s too much noise and traffic at noon. Or perhaps it looks great during the day, but the alley is poorly lit at night. To be even more thorough, ask the neighbors what they think of the area and its past. Did any crimes occur there lately that made the previous owner move out? Did the area lose its appeal among a particular demographic?
Steer clear of trendy additions
Luxury apartments have unique interior designs and advanced facilities that make living there an absolute dream. They will definitely catch your eye and make you want to consider the property, but before you buy, ask yourself how many of those facilities you actually need. Will your life be improved or was it just added to bump up the price? For example, additions such as dishwashers, double glazed windows, reconditioned hardwood floors are great because they increase both your quality of life as well as the curb appeal. But do you really justify spending a couple more thousand dollars for trendy additions such as Italian marble countertops or chandeliers? These are luxury items that make a great impression but that you’re better off buying on your own. And besides, they are subjective purchases so even if you do enjoy them, that doesn’t mean they will boost the value of the apartment if you decide to sell it.
Consider additional costs
The apartment’s final price might not be the one you bought it for. You will also need to consider additional costs such as insurance, utilities, and property taxes, which can unreasonable levels, even for a luxury buyer. As a general rule, the larger the apartment is, the more you will pay for utilities and, if the building’s electrical and plumbing systems haven’t been restored in decades, you are better of buying a house. This is especially the case for luxury apartments in period buildings. They might offer spectacular views, but they cost thousands to maintain. Last, but not least, ask your realtor to look into local property taxes. For example, property taxes can get as high as $8,780 in New Jersey and $6,947 in Connecticut, so you might want to look at more accessible states, like California or Rhode Island.