6 tips for investing in Washington luxury real estate

There are plenty of ways to invest, from stocks to real estate. One great way is investing in luxury real estate, as these make for higher or quicker returns on investment. To get you started, here are some tips to keep in mind when investing in luxury properties:

Identify your goals

Generally, there are two reasons why people invest in properties – they either (1) want consistent income or (2) want to make a quick buck. If you want a consistent stream of money, you might want to consider looking into properties that are suitable for long-term rentals, or properties that are considered high-end vacation rentals. On the other hand, if you want an immediate return on investment, look into flipping a luxury property.

Explore financing options

While luxury properties can make for great investments, not everyone has the financial capability to pay for these out-of-pocket. For luxury properties, jumbo loans are the way to go. These loans allow you to borrow more than the regular loans. If you’re looking to flip a luxury estate and you’re confident that you can get a high return on investment, try opting for a hard money loan. This is a short-term loan that is easier to get approved for.

It’s all about location

Whether you’re looking to put up a luxury property for sale or for rental, location is key. Popular vacation destinations such as those near beaches, islands, or ski resort towns make for great seasonal income. The more popular the destination, the higher the occupancy rate, ultimately gaining you a better return on investment. Meanwhile, if you plan to invest in a luxury property in the city, choose from homes with scenic views, accessible to dining and retail options, and close to top-notch schools.

Choose the right market

When you’re dealing with investments such as luxury properties, the stakes are naturally higher. Before you go into it, conduct a thorough market analysis of the location you’re looking to invest in. Look at data and trends on the cost of living, household income, job market, and the area’s overall economic outlook. For vacation rental homes, look at both the peak and off-peak trends.

Buy a luxury condo

If you’re looking to invest in the city, buying a unit in a luxury building is a great option. Luxury condos in prime locations can fetch high prices, and the return on investment is even greater if you buy the unit during pre-selling. Aside from the unit itself, amenities such as pools, gyms, view decks, and high security add to the appeal of luxury buildings.

Flip a home

Renovating an existing luxury property can have potential for a great return on investment. Luxury homes are generally well maintained, which means that you can spend less on rehabilitation and can redirect the spending into adding new features, such as smart technology. Keep in mind, however, that competition may be tough among other home flippers.

If you’re interested in investing in luxury homes, our agents at Coldwell Banker can help you look for the perfect property in Wenatchee, Leavenworth, Cashmere, or Lake Chelan, WA. For more information, contact 509.888.8887 or info(at)cbcascade(dotted)com. You can also leave us a message here.