What does it take to list and sell Chicagoland’s most expensive and luxurious homes? Chicago Agent consulted three Realtors who are pros at this game and uncovered what business practices work in the luxury home real estate market.
By K.K. Snyder
Today’s luxury home market represents more than exclusive addresses and fancy swimming pools. It’s a highly specialized field requiring uber-agents to be wholly available to their clients. Luxury homebuyers are often busy, no-nonsense demanding individuals requiring a special touch.
But operating at this level can be very rewarding, both in terms of personal satisfaction and income. Last year, real estate professional Jean Anderson sold the most homes over $1 million for Koenig & Strey. Consistently ranked among the best of the best in the luxury home category, Anderson is nationally ranked among the top 1 percent of agents, and recognizes that what used to be considered “luxury” no longer measures up.
“One to two million used to be luxury, but now we’re over that price,” says Anderson, winner of the Christie’s Great Estates Award as well as the Properties of Distinction Award for the past three years, having sold the most homes over $1 million company wide. She recently sold a renovated 1920s > home in Lake Forest for $8 million. “If someone thinks they have a luxury home at $1 million, it’s hard to tell them they don’t.”
Today’s luxury homes have elevators, wine cellars, media rooms, custom lighting, furniture-grade custom cabinetry and flat screen televisions in nearly every room. Commercial-grade kitchen appliances are standard and include as many as two or even three dishwashers, built-in cappuccino makers, Sub-Zero refrigerators, double ovens, wine chillers and separate freezers, all from top-of-the-line manufacturers including Viking, Thermador, Five Star, Bosch and Wolf.
Likewise, luxury homebuyers expect the finest finishes: exotic woods, marble and granite, custom woodwork, wide plank flooring, custom solid eight or nine foot doors and high-end hardware such as pewter and satin nickel.
“These buyers want something out of the ordinary, nothing cookie cutter,” says Anderson, who credits her success to the intense marketing she does for her properties, most of which are new construction. She represents Milestone Development and also works with David Poulton Group Ltd. and Windsor Builders, whom she says offer high-quality work and commitment to customer satisfaction.
Anderson sees a shift in the luxury home market these days as people are seeking out less square footage and more quality. “No more McMansions,” she says.
Representing luxury homes takes a special knack and is just as important as knowing how to market them and who to market them to. Anderson utilizes Internet marketing on multiple sites including Christie’s Great Estates, United Hemisphere and the enhanced version of Realtor.com. High-end professional photography and brochures are also key.
But it’s the face-to-face opportunities that come with playing host to a variety of events, wine tastings, parties that may include the general public, entertaining clients one-on-one, big realtor and broker open houses and benefits, that really spark interest and helps her build relationships with her clients.
She also credits her company, Koenig & Strey, for top-notch public relations that allow her to have her homes featured in upscale magazines.
“The people we’re dealing with that own these homes are the toughest ones, but we’re known for our service. You keep your word and do what you say you’re going to do and then it’s referral business,” says Anderson.
Failure in the luxury home market comes when people just aren’t willing to put the client first and they have their own agenda. Others just don’t have the time to commit. “My kids are [grown]. It’s hard for young moms to do this, to have the availability.”
Anderson has taught seminars on how to break in to the luxury home market. “Everyone wants to be at the high end right away, but you have to pay your dues. You have to build a track record and get out and sell some before you list some,” she advises.
Ranked in the top 1 percent at Coldwell Banker, Karen Peterson, GRI, is a member of the President’s Elite and consistently ranks in the top 1 percent of the 14,000-member Chicago Association of Realtors. She relies heavily on her peers and agents who sell properties like those she has available.
Additionally, she utilizes direct mail marketing and expensive glossy brochures heavy with details and floor plans. Like Anderson, she sees value in advertising in high-end magazines such as Unique Homes or Chicago Social, though she doesn’t find Internet advertising productive. She also hosts broker tours and special open houses and always has a custom sign done.
“I get a tremendous amount of calls from the signs and I’m always available, that’s the real key,” says Peterson, who represents Crescent Rock Construction in a relationship built on trust and loyalty over the past 12 years. “My business has come as a result of my referrals.”
During a transaction, Peterson doesn’t focus on the money she’s making. She loves the hard work and admits the money is important, but recognizes that her survival does not depend solely on any one deal. “If I feel the purchase isn’t right, I’ll advise them to look for something else.
Peterson’s clients want homes in the 7,000- to 11,000-square foot range, designed and constructed with attention to detail, something that goes over and above the norm. They routinely request grandiose rooms, custom fireplaces, master bedrooms with large walk-in dressing rooms, huge master baths, touchpad sensors to control the home’s extensive electronic features through the computer, radiant heat, four to six separate heating and cooling zones and high tech security systems with cameras.
“I’m very astute and I’m seasoned in new construction,” says Peterson of her success in this sector of the industry, which also includes re-sales of higher-end luxury homes. “I have a nice niche when it comes to people building new homes and designing plans for their lifestyle needs. >
Luxury isn’t relegated to the interior of these homes either, as outdoor living space continues to gain in luxury as well, from complete kitchens and dining areas to grand outdoor fireplaces and rooftop swimming pools in cities like Chicago where dirt and green space is at a premium. Peterson recently sold an 11,000-square-foot home for $4.6 million that featured a 2,400-square-foot roof deck, an incredible find in the city.
“I work with the developer to design a good floor plan that can be customized even more for a particular buyer. I put myself in the livability of the new home purchaser and how they would live in the home. I love creating and living vicariously through my buyers and what they want in a home.”
Sue Mitch has spent 30 years in the real estate industry in the Chicago area and through the decades her clients have grown right along with her, moving from condos as young couples up to the luxury home market as their families grew. Now many of these same clients are in the market for second homes or are looking to downsize to the condo market once again. Mitch’s architectural construction experience gives her the upper hand in recognizing what a client wants.
“It isn’t just a price tag. My clients take me all over this area and what might be considered luxury in one town might be in a different range in another,” says Mitch, who routinely sells homes on airports and golf courses and has built several luxury spec homes herself. For example, properties in Hinsdale range from $7 to $9 million, but you can’t define a property by the price. “You have to start with land prices, architectural style, interior design, finishes and amenities. We’re tearing down $2 million (homes).”
Most luxury homes take a great deal of time to market just by virtue of their price, she says. Unlike lower-end properties where a lock box allows other agents to show the home, listing a luxury home takes a major commitment. The listing agent must learn the house and everything about it and be present at each and every showing to provide information, even if another agent is showing it. Another major difference in the luxury home market is that appointments must be made to show the home, something demanded by both the seller and the buyer.
“Most luxury buyers are very busy people and it’s important that I don’t waste their time,” says Mitch, who gets as much information up front such as the client’s likes and dislikes, what style they are looking for and whether they prefer new or used. “And my buyers don’t want anything somebody down the block has.”
Mitch looks at each home individually and develops a marketing plan based on that property. She first concentrates marketing efforts among her peers – agents in the luxury home market. Next, she moves from direct marketing to her mailing lists, which are quite extensive after 30 years in the business. Mitch also uses quality brochures and Internet marketing such as RE/MAX’s Renowned Properties site as well as select magazines, depending on the best options for that particular home.
As far as trends in the luxury home market, agents are hearing more requests for properties that are “out there,” says Mitch, with elaborate fireplaces, custom molding and borders and lighting systems custom designed for each room.
“I didn’t come in with high-end clients,” says Anderson. “It’s all in the service and in being ethical, informed and honest. If you don’t know an answer, get it. And never sell a property you wouldn’t buy yourself…if you could afford it.” C.A.
Koenig & Strey, Lake Forest West
Coldwell Banker, Lincoln Park
RE/MAX Elite, Hinsdale