If you’re buying a $20 million luxury crash pad, it’s safe to say you’ve got the basic needs of food, clothing and shelter covered.
“No one needs a $20 million home — they want it,” said Nest Seekers International’s Ryan Serhant, “so, the emotions are much, much different.”
While buyers at lower levels of the residential market focus their needs such as space for a family or proximity to a job, buyers on the high end are driven by their wants, Mansion Global reported.
But while emotions are always a factor, they tend to be more important when the market is doing well, said Marin Bikhit, managing director of London brokerage Kay & Co.
When there are more options, buyers can be choosier and wait for the perfect property to come along.
“If we’re looking back three years ago,” Bikhit said, “everyone was more emotional then than they are now.”
Sales volume on luxury contracts was down 16.7 percent in 2016 from the previous year, according to Olshan Realty.
And on the rental side, owners are struggling to secure tenants for luxury pads despite steep price cuts and heavy concessions.
The exceptions to the emotion rule seem to be when someone is buying a second or third property as an investment, or when it comes to high-end rentals.
While renters tend to be more practical than emotional, some lease an apartment to try out a new neighborhood or test out a flashy pad.
“At the same time, it’s important that they connect with the apartment in their heart, because this is where they’re going to be living,” said Mark Tunstall, managing director of London luxury rental brokerage Tunstall Property. [Mansion Global] – Rich Bockmann