High-end housing markets across the world are seeing the same trend: Home sales are up. Sought-after locations like East Cape Baja, Mexico and Los Angeles are buzzing with sales. Even lesser-known luxury communities like one just outside of Youngstown, Ohio are hot; with real estate agents saying the market “is crazy right now.”
With travel restrictions lifting and interest rates dropping, luxury buyers see this as a good time to make an investment. While sales are up, the pandemic has changed the market a bit. To be prepared, here are several trends to watch for along with some tips to help you find the trophy home you’re looking for.
High-end home buying trends amid the pandemic
The housing market is experiencing some unique trends that elite buyers should be aware of. Those trends include:
Low interest rates
Interest rates are dropping right now, which is good news for any buyer. Locking in a low rate means cheaper payments over the course of the loan, but of course, these rates won’t last forever. As jobs return, kids go back to school, and confidence is restored, the interest rates will rebound.
Inventory is low
Inventory is always a challenge in the high-end market, but right now, sellers aren’t sure they’ll get top dollar for their home. As a result, some people are waiting to sell until the pandemic is under control.
For buyers, this means more competition for homes. You might not be the only one putting a bid in and may need to raise your offer to secure the home you want.
Prices dropped slightly, but are rebounding
At the beginning of the pandemic, luxury home prices came down. The median home price dropped by about 2.3%, in the first half of the year, but prices are already climbing again, according to Redfin, a real estate brokerage.
Research shows prices in the top-tier of the market have already started to increase. Experts believe they’ll return to their pre-pandemic prices in the next few months.
Uncrowded communities are in high demand
The pandemic has buyers looking for uncrowded communities with room to spread out. High-density urban areas aren’t attracting buyers. Instead, buyers are looking for more secluded spaces with room to move around.
Luxury communities like Costa Palmas, for example, where residents can buy a home along the sandy beaches of the Sea of Cortez are ideal. Buyers in this community have a home that’s surrounded by the outdoors with just a handful of neighbors in the area.
Luxury homes with amenities are preferred
The pandemic has people staying a little closer to home, so buyers are looking closely at nearby amenities. Resort communities with outdoor activities like a beach club or a golf-course, for example, will fare well.
Again, real estate in East Cape checks this box too. The Costa Palmas resort community has a beach club, marina, and an 18-hole golf course designed by golfing legend Robert Trent Jones Jr.
Watersports are also plentiful along the coast. East Cape is known for its kitesurfing, jet skiing, and sportfishing.
Beachfront property is ideal
Beachfront property has always been favored by elite buyers, but the current climate has people looking for more ways to alleviate stress. Watching the news, tracking the stock market, or even preparing kids for school is more stressful than usual. For this reason, people are looking for a getaway.
With the Sierra de la Laguna Mountains in the background and the sapphire Sea of Cortez in the front yard, East Cape Baja has a natural beauty that is the kind of awe-inspiring retreat buyers want right now.
Tips to buy an East Cape Luxury Villas during the pandemic
Ready to take the leap? Here are a few tips for buyers as they peruse high-end homes amid a pandemic:
Don’t wait for a better deal
Every buyer, no matter how wealthy, wants a good deal. To try and nab the best price or the lowest interest rate, you might be tempted to wait in hopes of more favorable terms. But, that’s a mistake. There’s no way to predict when prices and interest rates will hit rock bottom. While you wait, the home you want will likely disappear.
Weigh the risks of travel
It’s always best to see a home before you buy it. For example, if you’re eyeing a Four Seasons Residence along East Cape Baja, it’s important to walk through it to see if it feels like a good fit. However, that might not be possible in the current climate.
Travel restrictions to places like Mexico have eased, but it’s important to weigh the risks of travel.
If you do plan to travel:
- Look for travel advisories before you go
- Research the number of coronavirus cases in the area you plan to visit
- Take precautions set by the CDC like washing your hands, wearing a mask, and keeping your distance from people as much as possible
- Fly through private airports, if possible
If you decide that traveling isn’t safe, real estate agents can arrange a live video tour through Facebook Live or Zoom.
Buy premium properties in premium communities
Some buyers are worried that the resale value of a luxury home will drop because of uncertain markets caused by the virus. It’s impossible to predict the market’s fluctuations, but you can rest easier when you buy a premium home in a premium community.
There are certain markets that are always solid investments. For peace of mind, focus on high-end homes that are in preferred destinations like East Cape. Luxury resort communities like this are minimally affected, and if they are, the impact doesn’t last long.
High-end buyers are still more than willing to buy homes right now, despite the pandemic. The situation has created favorable buying terms, which has many people taking advantage of the opportunities in real estate. Of course, buyers should travel with caution and work with a real estate agent to take as many precautions as possible, but for many – now is the time to buy.