In the past, luxury real estate has been one of the most challenging markets to break into for several reasons. For starters, the existence of dominant agents already recognized by the community could discourage new agents from venturing in. Luxury markets also have tougher competition, slower sales processes, and fewer transactions to go around, and most agents are not patient enough to work in such a slow-paced market. Additionally, agents could simply not be ready for the challenges posed by a high-end market.
Jarret Willis got convinced to get a real estate license and try his hand at an ultra-high estate in 2012 by the Co-Founders of Bespoke Real Estate Agency’s Co-Founders. Jarret says that there are many things that agents need to know before making the transition into the ultra-high-end market. Here are some of the factors he’s put together to help you decide if the move to luxury real estate is right for you.
1. Are you ready for the higher competitive stakes and the different markets?
It is easy for agents to make a blind leap into luxury real estate with the hopes of more money. Jarret says that although the income per transaction is significantly higher than that of typical markets, working in a high-end market comes with a new set of challenges. The politics are different because you have to appeal to a more sophisticated crowd. The marketing and servicing costs are more and both the buyers and sellers expect and demand more.
2. Are you willing to be patient enough?
High-end real estate moves much slower than traditional residential markets. There are fewer homes in the market and fewer buyers with the means to purchase the expensive properties at any given time. The stakes are higher, and it, therefore, takes significantly longer to sell a home.
The competition is also high for limited properties, so building a strong client base and breaking into the market requires a lot of patience.
However, Jarret says that although listings are hard to come by and even harder to sell, the returns at the end of the transaction are worth the while.
In his experience, Jarret says that even under the tutorage of people who had been in the business longer than him, it took a while to make his first sale. But when he did, it was an extensive check of $35,000,000. Jarret advises that you shouldn’t go into luxury real estate without money in the bank as it is a business that requires a long-term process to build.
Before being convinced into ultra-high real estate, Jarret had his own fashion business up and running, which created a perfect bridge for his venture into the luxury real estate market.
3. Can you effectively communicate with a sophisticated crowd?
The luxury real estate market has a much savvier and more demanding crowd. Agents struggle to find their footing in an ultra-high-end market due to their inability to relate or communicate effectively with these clients. Jarret says that you don’t have to live in the luxury community you are targeting, but you have to present yourself in a manner that appeals to them. You have to pay attention to your networking skills, dressing, communication, and marketing materials. A robust professional image is what will win them over to do business with you ultimately.
Jarret adds that you need to be bold and unwavering so that you do not lose your credibility.
4. Are you willing to invest money in building a strong brand image that appeals to this new crowd?
In high-end markets, you cannot fake quality. Your materials need to be of high quality and look sophisticated. You must be committed to investing money to do the marketing right because this kind of crowd will see through you.
Jarret says that one strategy that they use at Bespoke Agency is to feature only listings above a specific price on their website despite also taking listings of much lower prices. What better way to depict your image as a luxury real estate expert than to put it on your website?
5. Are you continually up to date with market activity?
As a luxury specialist, you need to be fully in-tune with the market. Jarret says that you cannot navigate a transaction in high-end markets with minimal knowledge or experience. You need to stay current with the happenings in the market and know what listings have sold, for how much, and how long they’ve been in the market.
How you communicate with your clients about these things will make them feel better about the experience.
Ultimately, the decision on whether or not the luxury market is right for you is up to you. All you need is the willingness to invest the time and money to brand yourself as a luxury specialist and the patience to handle the slow-moving market. In the long run, it’s a lucrative place to do business.