Four tips for investing in real estate from four leading global luxury
US Wealth Is Growing: According to Coldwell Banker Global Luxury’s A Look at Wealth report, the population with net worth greater than $ 5 million grew 17% between 2019 and 21. At the same time, real estate assets rose to $ 3.6 trillion in 2021. How can you make money with so many real estate turning to diversify their investment portfolios?
Thousands of Coldwell Banker Global Luxury Specialists around the world are trusted advisors to clients looking to improve their property portfolio. I recently connected with four of them to find out their secrets. Jill Eber and Nathan Zeder are part of the prestigious Jills Zeder Group in Miami, which had sales of $ 1 billion this year alone. Beverly Hills-based star agent Joyce Rey serves billionaires from around the world after starting the first U.S. company exclusively in multi-million dollar homes in 1979, and Ed Feijo oversees the titans of biotechnology, medicine and universities in Cambridge, Massachusetts.
1. The Basics: Know your investment goals
When entering the investment market, Zeder encourages starting small: “Real estate is expensive, so make sure you are comfortable with it.”
LR: Nathan Zeder and Jill Eber
Before jumping into the game, Eber says, “Know your ultimate goal when you decide to invest.” Think about what type of investment you want to make and prepare accordingly. Are you buying to flip, rent or hold?
If your goal is to buy and rent the property, prepare to manage the property. Zeder and Eber emphasize that being a real estate owner is very different from turning around and selling; You have to be prepared for problems such as changes in the rental market, repairs and breakdowns. Real estate requires maintenance, and if you are not skilled yourself, you have a team of people to help you.
If you’re looking for a pinball machine, start small as the costs add up quickly. You may not be as concerned about inspections if the building is demolished, but be aware of the potential costs.
If you are planning to buy a second home to hold and later sell, know that these purchases require more care at the beginning of the transaction and inspection is more important. This is just one of many areas where having an agent as a trusted advisor during the transaction is important.
2. Location, location … return on investment
Feijo suggests prioritizing the location when investing in a rental property. make sure it’s always salable and located where tenants want to live.
LR: Ed Feijo and Joyce Rey
When buying a property, ROI often matters. “Never give up a good opportunity because you will never regret a good purchase,” advises Feijo.
Rey notes that the most discerning investors she has worked with are looking for prime locations and quality construction, which is what makes their market exceptionally strong.
Eber agrees that desirable locations, water views, and a sense of home are most important to buyers. Proximity to schools, if desired, and accessibility are also important factors. The investor looks at all of these elements, but the bottom line of the investment matters most and location always affects the ROI.
3. Prepare for luxury migration
This has been the year of the move, so experts suggest being flexible when it comes to investing.
In California, Rey has seen a huge migration to the suburbs as people look for more land. Although she moved to other states, people kept their California homes and added second homes in other states to their portfolios for tax reasons. As for people’s origins, the market continues to be largely domestic, but Rey has seen global buyers again. On an annual basis, the luxury market consists of 20-25% foreign money.
Like most cities in the US, Cambridge has a scarce population. It’s a great secondary city outside of Boston where people feel like they are getting more for their money. Feijo notes that he has seen many younger families move to the area, with buyers mainly from the domestic area. He occasionally sees international buyers with children attending nearby universities such as Harvard and MIT.
Miami has always been an investor hotspot because of its multicultural, welcoming nature; unsurpassed location; and international reputation. Zeder says there has been a monumental surge in movement from other parts of the country, including California and the Northeast, perhaps most of those who have seen it. He believes that with the lifting of travel restrictions there will be an influx of international buyers.
We are seeing a wave of investors choosing to invest in real estate rather than the stock market because of the lower volatility and overall stability. In addition, Zeder’s international clients often invest in US real estate because they see it as a potentially “safer bet” in the short and long term.
4. Find a great partner
Navigating the nuances of real estate investing can be tricky, so the final must is finding the right real estate professional to guide you through the process.
It’s easy with our extensive network of 90,000+ knowledgeable agents. “Choose a great broker at Coldwell Banker,” says Rey. “Get professional advice and guidance from a knowledgeable real estate agent whom you implicitly trust.”
When you’re ready to invest, visit https://www.coldwellbanker.com/about.
Those named here are not licensed financial advisors. Let a licensed financial advisor advise you on personal financial decisions.
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Michael Altneu is Vice President of Luxury at Coldwell Banker Global Luxury.