More than half of investors surveyed by Millionaire Corner this month believe it is a good time to buy real estate. Of course there is real estate and there is real estate. Case in point: the Fine Properties Fair that took place this week. Presented by The Economist, the online fair afforded participants to browse “a collection of unique second homes, vacation estates and luxury rentals” in locations such as Australia, Belize, Boca Raton, Canada, Miami, and St. Maarten.
Here’s one: A four bedroom penthouse with 5.5 baths on the 28th floor of the the palatial Palms in Ft. Lauderdale. Features include more than 4,100 interior square feet and 392 square feet of terraces, spectacular ocean views, two sub-zero refrigerator/freezers, master His and Her baths, and cable TV. Offered at: $2,495,000 (not including $3,129 monthly maintenance fee).
The luxury market is alive and well, so much so that Bloomberg LP is poised to test a new monthly magazine, Bloomberg Pursuits, which Adweek reported, will be about “the high-end lifestyles, products, and services for its well-heeled readers.”
The luxury properties market is on more solid ground than the housing market in general. A study of ultra-wealthy households conducted by Millionaire Corner found that three-quarters of households with a net worth of $25 Million Plus (not including primary residence) own a second or vacation home, up from 67 percent four years ago, Almost half own a third home or vacation home, up from 35 percent in 2007. The percentage of those with time shares and vacation clubs has almost doubled.
It is, at least, on the rebound, according to real estate expert Kathleen Peddicord, who presented a webinar at the Fine Properties Fair about the best places in the world to buy property for retirement, a second home, or an investment. The recession, she told Millionaire Corner, did impact the market in some countries, where some luxury-end values fell by as much as 50 percent.
“It’s a good time to be a buyer,” she said in an email. “Tremendous bargains remain.”
The most popular locations to by luxury property, she said, are “established resort and second-home destinations. New areas that aren’t as well known and that don’t have any track record for rental, etc., are scarier to would-be buyers. Belize, for example, is attracting more attention, and the market on Ambergris Caye, the most developed part of this country, has been rebounding (after a big fallout in 2008) over the past 10 to 12 months.”
Peddicordrecommended that prospective buyers “understand your objectives and exit strategy before making a purchase.” Will the property be used as a second home, a place for retirement or a holiday home that would be rented out when not in use by the owner?
Understand, too, she said, that financing is not available in all markets such as, typically, Latin America (although, she said, Panama is an exception). In the current challenging economic
Carry out more due diligence when buying overseas than you would at home.
Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.
A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.