Table of Contents[Hide][Show]
- How To Sell A Million Dollar Home: The Difference Between Selling A Luxury Home And A Regular Home In Your Market
- Hire An Experienced Luxury Home Real Estate Agent
- Interview Multiple Real Estate Agents Before Choosing One
- Make The Listing Agent Spend Money To Make Money
- Insist On Seeing A Detailed Marketing Plan For Your Luxury Home
- Your Home's Photography Is The Single Most Important Piece Of Your Listing
- Your Listing Should Communicate The Luxury Experience
- How To Price A Luxury Home
- Is Your Agent Able To Provide Weekly Analytics Reviews?
- What If Your Current Real Estate Agent Sucks?
- Learn From My Luxury Real Estate Mistakes
Here are some helpful tips for anyone selling a luxury home that will help you maximize your sale price and make sure that your realtor is really working for you, not themselves.
How To Sell A Million Dollar Home: The Difference Between Selling A Luxury Home And A Regular Home In Your Market
Depending on where you live, the definition and price of a “luxury home” will vary. In most parts of the United States, a million dollar home is definitely in the luxury category. But in places like Fort Lauderdale, New York City, and San Francisco, the type of home that $1 million dollars can buy might remind you of a joke from the 1997 movie, Austin Powers.
Regardless if you’re selling a million dollar home or not, if your home is considered to be in the luxury category for your region, then these tips on how to sell a luxury home will be extremely helpful.
Essential Luxury Home Selling Tips
Luxury homes attract a much smaller buyer segment, so it’s essential that you do everything possible to catch the attention of a luxury home buyer before someone else does.
I’ve broken down my personal experience into the luxury home selling tips in this article.
Hire An Experienced Luxury Home Real Estate Agent
If you are selling a luxury home, then you need to hire an experienced luxury real estate agent. Do NOT hire a regular real estate agent. Do NOT hire a friend or a neighbor… even if they offer to shave off a percentage from their commission. It’s NOT WORTH IT. The money that you might save from hiring a friend at a lower commission percentage is a risk that you should never take.
If your home doesn’t sell in the first 30 days, then you’ll probably have to lower the price anyway. At that point, you are losing the money that you would have saved from the lower commission rate, plus you’ll still stuck with an inexperienced real estate agent.
Interview Multiple Real Estate Agents Before Choosing One
Hiring an agent should not be a rushed decision. Every agent will want to list your home. They will be seduced by the higher commission attached to selling a luxury home, so you should be very picky about whom you choose to work with.
Try to interview at least 4+ realtors before making a final decision. It’s time-consuming, but you’ll probably learn a lot about both your market and the pros and cons of each real estate agency during the process. Here are some questions to ask when you are interviewing luxury real estate agents:
- Do you specialize in the sale of luxury homes? — If the answer is “no”, then move on as quickly as possible. Selling a luxury home isn’t easy, and you don’t want the sale of your home to be a “learning experience” for an inexperienced agent.
- Do you have an active and current client list of people who want to buy a luxury home? — An agent that specializes in luxury homes will already have a list of affluent buyers that are looking to buy a new home in your area.
- How do you attract out of state “whales”? — One of the most important buyer segments for luxury homes is wealthy out-of-state buyers, aka “whales”. Savvy luxury realtors will advertise out of state and have strong connections with other agents around the country who have affluent buyers moving to your area.
- How are you going to stage our home for photography? — It’s extremely rare for a home to be photo-ready “as is”. A good agent will use their years of experience from selling luxury homes to suggest a series of tweaks. These strategic changes will need to be made to your home in order for it to sell quickly. This might include painting, staging, landscaping, etc.
- What support resources do you have to help prepare my home for the photographer taking the listing photos? — Your “luxury” agent should be paying for a staging company or interior designer as well as the photographer, NOT you. If you get pushback on this point, then you probably aren’t actually speaking to a luxury real estate agent.
- Will you be present during the photography sessions? — If your agent really cares about selling your home, then they will be present during all major photography. That’s how essential your home’s photography is to the listing.
- How is the photography for your listings different from other agents? Can I see some photos? — For a true luxury home, you want your photos to look like they should be in a magazine. Seriously, your photos should be so good that they make you want to reconsider moving.
- Can your photography team also produce videos, drone footage, and a 3D tour? — Photos are NOT enough anymore. Take a look on Zillow at the other luxury home listings in your area. In addition to spectacular photos, they will probably have videos, drone footage, and even 3D walkthroughs created with Matterport cameras. If your home doesn’t have these extra elements, how do you think it will compare to the other luxury homes that do?
- What is the marketing plan… besides just posting our home on the MLS? — This is the most important question. If your agent can’t provide a written marketing plan that includes elements like social media campaigns, direct mailers, and paid advertising, then don’t hire them. Remember, you are paying your agent a small fortune in commissions for them to sell your house. Your agent should be investing somewhere around 5% of their potential commission into the sale of your home.
Make The Listing Agent Spend Money To Make Money
Real estate commissions are negotiable, but you will probably end up paying about 6%, or $60,000 for every $1 million dollars. For that amount of money, the agents and brokerages involved in your home sale should be working their butts off to earn every cent. That is especially true for your agent, the listing agent.
You don’t want a cheap listing agent. Your agent should be willing, and even excited, to spend money to help sell your house. Window cleaning, photography, staging, a final clean out, and advertising campaigns should all be paid for by the agent, NOT you.
Insist On Seeing A Detailed Marketing Plan For Your Luxury Home
Selling a luxury home usually requires spending thousands of dollars on marketing. If your agent’s definition of “marketing” is just simply posting a listing on the MLS (multiple listing service), then that’s a major red flag. Do NOT work with that agent. They are either too cheap to spend money to market your home, or they have no real marketing experience.
Here are some talking points to reference when discussing marketing efforts with your agent.
- Marketing Plan: Ask to see a sample luxury home marketing plan. Don’t accept a verbal strategy. You want to see a professionally prepared plan and be careful about smaller mom-and-pop real estate firms. Smaller firms probably won’t have access to professional marketing and creative services.
- Paid Media: Your real estate agent should plan to use several types of paid advertising efforts to promote your luxury home.
- Added Value: Watch out for a marketing plan that only includes “added value” or free marketing tactics. Mentioning your home in a tweet from an account with no followers or being included in the real estate agent’s newsletter isn’t targeted or very valuable at all.
- Custom Listing Submissions: Instead of only relying on the MLS to share info about your home to online listing services like Zillow and Realtor.com, high resolution photography must be individually distributed to each major partner site. It’s a lot of extra work, but well worth it. Make sure your agent is doing this.
- Out-Of-State Advertising Efforts: Geo-targeted posts on platforms like Instagram are a great way to connect with out-of-state buyers. One of the luxury real estate agents that I spoke to bought an annual ad campaign in affluent zip codes near Los Angeles. Even though she only sold homes around Park City, UT, she used the ad space to keep her pipeline fresh with new prospects.
- Established Social Media Presence: Does your agent have an active social media presence? If they don’t have an Instagram account, then how are they supposed to launch a targeted Instagram marketing campaign for you home?
- Use Of Data & Analytics: Savvy real estate agencies will use data to optimize paid advertising campaigns. For example, if people in New York City, Philadelphia and Boston are the top geolocations browsing your listing, then your agents should look at running paid advertising in these areas.
- Relationships With Local Publications: Luxury real estate agents will often have regular ad space in local digital and print publications. Ultra luxury homes will typically take several months to sell. Getting featured in media publications is a great way to get some extra exposure for your home.
- Relationships With Luxury Real Estate Sites: Websites like Zillow and Realtor are great, but they have a lot of non-luxury listings that affluent buyers don’t want to see. Ask your agent if they have access to post listings to sites like LuxuryRealEstate.com.
- High-End Print Materials: Ultra luxury homes will usually have custom printed booklets for prospective buyers. If you suspect your property will take more than a month to sell, then this is a very good idea for anyone selling a luxury home.
Your Home’s Photography Is The Single Most Important Piece Of Your Listing
Active home buyers will be scrolling through apps like Zillow on a regular basis. Your home’s photography will likely be the deciding factor that gets them to schedule a showing.
- Photos: The photography must be incredible. They should look like they belong in a magazine.
- Twilight Photography: A good photographer will also take an extra set of photos during twilight. They will turn on every light both inside and outside the house (fire pits too). Then take a set of photos just after sunset. These photos really help communicate the luxury experience to affluent buyers.
- Video: Most luxury homes also have a short music video. In today’s age of TikTok and Instagram Videos, your home listing won’t be complete without a video.
- Drone Footage: Key outdoor elements, like water fixtures, swimming pools, landscaping, and fire pits, are best showcased using aerial video.
- 3D Matterport Tours: The best way to virtually put someone in your home is with a 3D tour shot using Matterport cameras. This is especially important for out of state buyers who might even purchase a home sight unseen.
Your Listing Should Communicate The Luxury Experience
Another thing that you need to realize when selling a luxury home, is that you are selling more than just a home, you are selling an experience.
Why do you love the house? Why did you like living in the neighborhood? For example, if you have a fire pit, then your luxury real estate agent should insist that their photographer take photos of the fire pit lit during twilight. You want to help buyers envision their family outside by the fire pit at night.
How you communicate that love (aka your value proposition) to potential buyers could be the difference that makes your house sell at full price.
How To Price A Luxury Home
Because of their higher price tag, luxury homes usually spend more time on the market than lower priced houses. At the same time, you don’t want to undervalue your house. Affluent home buyers will understand the difference between “cookie cutter” home features and the unique amenities of luxury real estate.
So how do you value a luxury home? An experienced luxury real estate agent will pull recent home sale comparisons and factor in the value of any unique features of your property. Sophisticated software can then run numbers that calculate market tends and provide a price range based on your desired sale timeline.
Also, beware of agents who want to price your home exactly in major increments, like $1,000,000, $2,000,000 or $3,000,000. This probably means they are inexperienced with how online searches work. For example, instead of $2M, your luxury home should be priced slightly lower, like $1,950,000.
But if priced correctly, your home will have a much better chance of fetching fair market value.
Is Your Agent Able To Provide Weekly Analytics Reviews?
If your agent is truly proud of their detailed marketing efforts, then they should have no problem with agreeing to participate in a weekly analytics meeting with you.
- How many combined views from multiple listing sources did your home get this week?
- What is the ratio of views to showings? How does that compare to other luxury listings in the area?
- What feedback did you receive from your showings?
- What action(s) should be taken?
What If Your Current Real Estate Agent Sucks?
You only have one chance for your home to be a brand-new listing on the market. If your home isn’t immediately attracting attention from prospective buyers, then something is wrong.
Things like easements, flood zones, power lines, property disputes, and neglected repair and maintenance issues at the property, can all be major turnoffs to potential home buyers. But if your house doesn’t have any issues and isn’t getting any activity from potential buyers, then your real estate agent might suck.
Don’t worry, there’s still some hope. Here are some ways to breakup with your inexperienced real estate agent:
- Try To Get Your Agent To Agree To End The Contract: Have a candid conversation with your agent and calmly talk through why the relationship isn’t working. Your agent might not specialize in selling luxury homes and may be way out of their league. Selling a luxury home is a lot more complicated than just posting a house on the MLS. That strategy might work for average priced homes, but it probably won’t be effective for a luxury home. If your agent doesn’t have things like an Instagram strategy, high-end photography resources, stagers, analytics capabilities, designers to create targeted mailers, and geotargeted advertising campaigns, then luxury home selling is probably beyond their expertise. If they are truly honorable, then they should agree to end the contract.
- Let The Contract Run Out: If your agent doesn’t know how to sell a luxury home and is a jerk that won’t let you out of your signed agreement, then you will have no choice but to let the contract run out. It’s not to the agent’s advantage to do this. As you begin interviewing new agents, all of their counterparts in the market will hear stories of their incompetence and it will start to destroy their credibility.
Learn From My Luxury Real Estate Mistakes
The advice in this article wasn’t compiled from other articles on the Internet. It’s my first-hand experience and the lessons that I learned from selling a luxury home. Hopefully you’ll find something in this article helpful and not have to relive this ordeal yourself.
I made a terrible mistake when I tried to sell my home. It was a unique 6,000 square-foot mountain home estimated by Zillow to be worth $1.5M. Out of a sense of loyalty, I asked a family friend to sell my house. This guy was a seasoned realtor and well-known in the area. He also offered to reduce his rate by 1%, potentially saving me $15,000 in commission fees. Initially, I was excited, but things went wrong right away.
Even though my agent had decades of real estate experience, his written description of my home was amateur at best. Here we were potentially paying $75,000 to a real estate agent who wasn’t even capable of writing a compelling description of our home. We had to rewrite the description for him.
Then came the photoshoot. I took the day off from work to meet the photography team to help with staging and logistics. But there was no team, or staging. The “photographer” was just some guy with a digital camera in his pocket. That was it. Our “photoshoot” was limited to just a guy walking around my house for about 15-minutes taking photos. I could have done that… and probably should have. I saw the photos of my house later that night. Nothing about them was nice or would be enticing to a luxury home buyer. Our photographer didn’t even bother to straighten the pillows on the couch before he took his pictures.
With an average description and basic photos, we listed our house and hoped for the best. The market was hot, and we were still optimistic that quickly selling a luxury home was a real possibility.
The next day, my wife and I called our realtor and asked him about the marketing plan. Our contract with him specifically mentioned that “marketing” was part of his services. His response made us realize that we had made a terrible mistake. His idea of “marketing” just involved listing our house on the MLS, the real estate multiple listing service that sends a home listing to services like Zillow. That’s it. He wasn’t planning on spending a dime on paid advertising for our home.
And so our house sat on the market, with barely any activity. Other properties in our affluent zip code were quickly snatched up by luxury home buyers. In 45 days, we only had 8 showings and zero offers. Our lazy realtor only relented to host an open house for us after we pressured him. It was a bust. Only five groups of people showed up.
The longer our house sat on the market, the more pressure we felt. In a hot real estate market, after a house has been listed for more than 30 days, then something about it is probably wrong. Things like property line disputes, a leaky roof or just being overpriced, will turn away potential buyers. But there was nothing wrong with our house, and it wasn’t overpriced. The cost per square foot was actually on the lower side compared to the other luxury homes in our area.
We called and texted our real estate agent every day, asking him what his strategy was and trying to help him with marketing ideas. We even had other real estate agents that we knew call him to offer advice. Our realtor eventually got so angry with us that he ended our agreement effective immediately. Thank goodness. It gave us an opportunity to regroup.
Learning from our mistakes, we hired a local real estate company that specifically specializes in selling luxury homes. They were immediately able to identify critical mistakes that our inexperienced real estate agent had made:
- Nothing in the marketing materials for our listing presented our home as a “global luxury property”.
- Since the luxury experience wasn’t being communicated in our marketing materials, our house wouldn’t sell as a luxury home. We were missing several critical elements required to attract affluent out-of-state luxury home buyers, like high-end photography, a 3D tour, and custom videos.
- The listing price was wrong. Our inexperienced agent made a rookie mistake. Our home should have been listed at $1.49M to appear in more search results, not $1.5M.
- Our old agent didn’t have access to the sophisticated software that luxury real estate agents use to make strategic decisions. For example, using MLS views per day, location views and recent comps to calculate price adjustments and targeted marketing efforts.
It took our new luxury real estate agents two weeks to stage, photograph, prepare a marketing plan, and create a video of our home for the updated listing, but it was well worth it. The new photos were stunning, and we even got a little emotional after watching the music video.
Our luxury real estate agents were so experienced that they were even able to get our house a new MLS number, making it appear that our home was being listed for the very first time.
After relisting our house with the new luxury real estate agent, we had multiple offers in just a few days. Here’s the timeline of events from listing start to formal offer.
- TUESDAY: To help get their staff excited about selling our house, our new real estate agent paid for a catered cocktail party and invited everyone from his office to our house for drinks and appetizers. This was a brilliant way to help engage his entire team around the sale of our house.
- WEDNESDAY: We listed our house the Wednesday right before Thanksgiving and scheduled open houses for both Saturday and Sunday that weekend.
- THURSDAY: Marketing efforts, including a paid Instagram post and a blog post about the cocktail party at our house, began on Thanksgiving Day.
- FRIDAY: After three scheduled showings that morning, we had an afternoon garage sale to help thin out our belongings before the move. During the garage sale, three separate groups of people stopped by saying that they had seen the incredible photos of our house on either Zillow or Instagram. By Friday night, we had two buyers working on offers.
- SATURDAY: After one scheduled showing in the morning, an open house took place in the afternoon. At one point, I checked the security cameras and counted twenty-five cars parked outside our house! By Saturday night, we had one more offer and one person back out.
- SUNDAY: There were four scheduled showings throughout the day and another open house on Sunday, which attracted about fifteen groups. After the open house, we hosted a party to say goodbye to our friends outside by our fire pit. But one of the showings wanted to come see the house during the party. They loved seeing how fun our house could be and huddled in a room in our house with their agent and pieced together an offer on the spot.
- MONDAY: By Monday night, we had two written offers from interested buyers escalating the final offer up to another additional $50,000 and a verbal backup offer.
That was it. With our new agent that specialized in selling luxury homes, our house was on the market for less than a week! Is it hard to sell expensive houses? Yes, but only if your real estate agent doesn’t have experience selling luxury homes. Our new agents made selling luxury real etstae look easy because they knew exactly what they were doing. Our house had more activity in just one weekend than our previous agent was able to generate in over a month and a half.