The terminology of luxury real estate, as related to luxury homes or luxury condos, is nearly always a moving target. From the consumer perspective, homes sellers wonder if the home that they are selling meets the luxury home category and buyers wonder if they are shopping in the luxury category or simply purchasing a relatively expensive home. The classification of luxury real estate varies widely geographically so properties considered luxury in the Bonita Springs area may not be considered luxury in a different real estate market.
Basically, luxury pricing is considered the top 10% of closed sales in the past year. In the Bonita Springs real estate market or any market, that description alone creates the moving target. Sometimes the high end properties are selling in significance and sometimes they aren’t selling whether it’s due to the time of the year or the economic climate of the specific geographic location or the economy of entire country.
Diving deeper, into that top 10% of luxury home sales are the subcategories of starter-luxury, luxury and uber-luxury.
Think of any luxury real estate evaluation, including this assessment exercise, like a photograph. It’s only tells the story at a particular moment – Summer 2017. At this time, homes priced from the $797,000’s are considered luxury real estate in the Bonita Springs Florida area. Next, take into consideration three luxury brackets within the category of luxury real estate – Starter Luxury top 10% to 5%, Luxury 5% to 2% and Uber Luxury which is the top 1% of sales.
The “highest and best use” of the real estate under the home may determine that a property deemed luxury, by price point standards, is best served by tearing down the structure and rebuilding. This would then move the property in the luxury category which is the top 5% or the uber-luxury real estate category which is the top 1% of home sale prices.
This is a likely scenario for property on Bonita Beach where single family homes can sell in the high one-million to two-million dollar range that aren’t particularly large in square footage or completed at the highest level of finish. While still a lovely waterfront home on the beach, it is dwarfed by the neighboring newer properties. The price may be in the uber-luxury category but the home may be on the fast track to being demolished and replaced with a new structure that maximizes both the square footage of the lot and the potential vertical height by adding additional stories.
Conversely, the “starter luxury” category could be a newer home in a golf course community like Bonita National. Starter luxury in this community is actually the high end of the value spectrum for the community meaning that a starter luxury home might be the nicest or largest home behind the gates.
Two additional factors that determine luxury are prestige and convenience. Home buyers who are purchasing luxury real estate for prestige are looking for imported fixtures, elite appliances and high level finishes and designer furnishing throughout the entire residence. The things that most homes may not have, something uniquely special or on the cutting edge of design and technological enhancements. The second priority is typically home buyer specific and something that adds to their own use and enjoyment of the property whether it is a state-of-the-art gourmet kitchen, full-scale home theater or having other nearby conveniences such as concierge services provided by the building management or home owner association.
If you’d like to learn more about buying or selling a luxury home in Bonita Springs contact Chris Griffith at 239-273-7430.
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