How to Become a Luxury Real Estate Agent – 14 Tips for Breaking Into the Luxury Market
Luxury real estate deals with high-end properties and wealthy buyers and sellers. This competitive market is somewhat more delicate than general real estate and requires even more attention to detail.
The central point of luxury real estate is the people – the agent, the clients, and others who participate in the market. Knowing how to brand yourself, build a relationship with clients, and cooperate with other brokers will make all the difference.
Continue reading to find out what experts had to say about breaking into the luxury real estate market.
1. Be Patient
Taking your time is essential. People in the luxury real estate market deal with massive amounts of money and extremely valuable assets. For that reason, they need to trust their agent entirely and make sure their best interests are represented. Building this kind of trust doesn’t happen overnight, and it will require a lot of patience on the agent’s part. Jennifer says she would know, after working in the luxury space for more than a decade after earning her California real estate license.
On the same note, the luxury market is already full of experienced, highly successful agents. It’s a competitive environment that doesn’t make it easy for newcomers. Creating a reputation as a dependable, capable agent can take a long time. Making a breakthrough will require constant motivation and hard work, but crucially – patience. (from Jennifer Okhovat, luxury real estate agent for Compass in West Hollywood)
2. Add More Value to Your Business
The most successful marketing strategy for breaking into the luxury real estate space is always trying to do what others aren’t doing. Separate yourself from the pack. Investing more effort and funds into property marketing and advertising through harder to reach channels will differentiate a great agent from an average one.
Knowing the market inside-out is vital when dealing with high-profile real estate. You’ll earn the client’s trust more easily if you can present them with more than basic stats. Provide details about how a neighborhood’s performing on the market, unlisted properties, market trends, and potential deals the client isn’t aware of. Being a real estate expert means, among other things, giving your client information others don’t have or fail to share with buyers and sellers.
The luxury real estate market’s very nature demands a thoroughly developed relationship between the agent and the client. This means paying attention to every aspect of the interaction, from your self-presentation to how you communicate with the client. Be presentable, always on time and on schedule. Consider when your client’s available and plan your contact with them accordingly. In other words, respect your client and their time.
Most often, people who deal in luxury real estate are successful in their own right. The agent’s attitude towards them should reflect that. Acknowledge the client’s success with measure – don’t disregard it or take it for granted. But avoid pandering to them. In the same vein, ensure your client’s privacy is maintained to the maximum, and make them aware of your efforts to that end. Finally, get to know your client’s tastes and preferences in smaller matters. Present them with a small gift of something they enjoy. The deal you might be closing is worth the extra effort, and a closer relationship with a luxury client can prove invaluable for future business. (from Ryan Waller, Licensed agent for Home Group Realty in Guelph, ON)
3. Make Luxury Part of Your Personal Brand
Breaking into the luxury real estate market isn’t easy, and self-marketing is the most important part of the process. Advertise in the higher-end areas with zip code-specific postcards and ads. Make the market aware of your existence. Visit locations and venues that potential luxury clients frequent. Those are museums and art shows, charity events, golf and tennis clubs, and similar locations.
From the outset, start working on your branding and image. When you make a noticeable sale, always get a testimonial from the client and make sure everyone learns about your latest deal. Know where your business stands on the market concerning prices, client satisfaction, and the overall quality of your service. Find out where your points of excellence are and talk about them on appropriate occasions. Word-of-mouth marketing is a powerful factor for businesses on the rise, so don’t underestimate it. (from Ryan Waller, Licensed agent for Home Group Realty in Guelph, ON)
4. Get Involved With Charities
Generally speaking, high-income people enjoy supporting good causes, attending charity events and functions, volunteering, and even fundraising. Start with a cause that means something to you personally. Your relationships and opportunities will develop naturally when your dedication to the cause seems genuine. From there, you can build a network that will lead to new opportunities, plus you’ll be helping your community.
This is a strategy that really requires authenticity and sincerity. Don’t fake a passion or a love of rescue cats if you don’t like animals—people will be able to see right through you. If it doesn’t feel real, then you’ll come across as disingenuous and calculated. Keep that in mind when picking the charity and cause.
5. Pick Up a Fancy Hobby
The best way to meet high-net-worth clients is by doing something you already enjoy, or could see yourself enjoying. This can be as simple as joining your local water polo club, picking up cricket, finding a nearby antique car group, or attending a few fine art shows or wine tastings.
While buying a thoroughbred race horse or an expensive car might not be feasible for you, you can always find other ways to get involved. For example, you may not be able to afford an antique Mustang, but you can certainly educate yourself on the company’s history and attend meetups and car shows to show off your knowledge.
Then, if you are attending an upscale vintage car race, you can bring a list of your latest luxury properties that feature multi-car garages or outbuildings that would be perfect for a vintage car collection.
Again, I cannot stress this enough, nobody likes a poser—so start with a hobby you actually enjoy, or at least find interesting. It’s also okay to ask questions if you are genuinely interested in knowing more about a subject. Nobody likes a know-it-all, so instead make easy conversation with the high-income people that are attending the events.
6. Solve Rich-Specific Problems
Remember, you’re not just a realtor, you are a luxury real estate agent, and you offer more knowledge and broader expertise. Below is a list of common concerns for high-net-worth individuals, which often go hand-in-hand with your luxury real estate services.
- Zoning and land use
- Development
- Banking and lending
- Common property and prenuptials
- Real estate investing
- Legal tax avoidance and tax consequences
- Asset appraisal, privacy, protection, and preservation
- Insurance
Think of one (and only one) problem that a luxury client may have that you can potentially help them solve. You can then position yourself as the one person in your market who solves this problem for affluent prospects and clients. Reflect on your entire career and experiences, then start by asking yourself the following questions:
- Which of my luxury clients would benefit from this unique skill I have?
- What experiences, skills, and knowledge are valuable to a luxury client in my area?
After you finish that, write a statement to use on all your branding and marketing moving forward. One example could be: “I don’t follow trends, I set them by helping high-income professionals diversify their property portfolio”.
7. Be Dedicated to Every Client
Giving every client the same amount of attention, regardless of the transaction value is really the key to breaking into luxury real estate.
The real estate business, and the luxury market in particular, is centered around the clients, not the brokers. A real estate agent provides a service, and that service needs to be of the same quality for all. While not all deals are equal, your reputation can be affected by every review and shared impressions.
It’s important to know what luxury clients want, and to make sure you show them homes that deliver. In light of the pandemic, luxury buyers are showing a preference for townhouses and boutique condominium buildings as opposed to large apartment buildings. Also, many buyers are seeking properties which incorporate a home office, gym and/or sauna. (from Jonathan Hettinger, a luxury agent for Sotheby’s International Realty – Downtown Manhattan Brokerage)
8. Study the Details
Every single small detail in a property worth millions of dollars is important. The small stuff can actually make or break a real estate transaction. When you’re showing a luxury property, you need to be ready to point out the luxury finishes, from the big obvious Olympic-sized swimming pool to the tiniest cutting-edge speaker.
If you happen to work in a market with lots of expensive historic homes, you need to use the proper vocabulary: know a cornice from a corbel and the difference between balusters and the balustrade. And be familiar with historic districts, easements, and zoning boards that could get a say in renovations and restorations. Also be sure to point out what pieces of the home are original, along with the dates they were last restored. Vintage details are a huge selling point, so don’t let clients overlook them.
Are your affluent clients looking for a place on the water? If so, you should know your boat lifts and dock permits. In the mountains of Wyoming, what are the fire risks, the best ski lodges, and stocked trout streams? If someone is going to pay a premium for luxury property features, you need to become the luxury agent who knows what they are and why (or if) they’re worth it. People will pay for experiences, so be sure to showcase that. If there a stream that flows through the back half of the property, point out the nearby waterways that it flows into, etc.
9. Work With a Mentor to Get Your Foot in the Game
Success in luxury real estate doesn’t come fast and easy.
Finding an experienced mentor is the best way to learn the ropes. Prepare to spend about four years working with them. It might seem a long time, but that period just might give you the edge when competing with proven agents that have been in the business for decades.
Remember it’s not enough to just have the license. Progressing from regular agent to luxury real estate agent will require you to become specialized and know all of the ins and outs of the market. Be ready to dedicate years to perfecting your knowledge and skills.
You can help reign in those skills at first by helping other luxury agents with their marketing, events, and open houses. When you can show your well-to-do peers that you are hungry, they will be more likely to take a chance on you in the future.
Don’t be too proud to co-list, either. If someone is too busy to take on a luxury listing, offer to jump in, co-list, and do the grunt work they don’t have time to do. Half of the commission from a luxury real estate listing is still well worth it. As you know, it’s all about the hustle (from Bobby Lieb of HomeSmart Elite Group)
10. Get the Certifications to Back It Up
If you choose to go down the path of becoming a respected luxury real estate agent, you need proof that you have the knowledge, skills, and experience necessary to handle such an expensive asset. There are several designations and certifications you can get explicitly designed for agents in the luxury real estate market industry, including:
- Accredited Luxury Home Specialist (ALHS)
- Luxury Homes Certification (LHC)
- Certified Luxury Home Marketing Specialist (CLHMS)
If you get one or more of the certifications, be sure to list that in your bio on your website. That can help to set you apart from the other luxury agents in your area. These accreditations will teach you about tax advantages, the technology driven listing process, the luxury real estate brokerages available, etc.
11. Be Authentic
Top producing luxury real estate agents stress that a good agent should always be true to themselves and loyal to their clients. That’s a trick that Jamie’s seen work time and time again since earning her Texas real estate license 14 years ago.
Letting the client know who you are is essential for building trust. You should be authentic around them – they’ll appreciate it much more than if you try to put on a facade. The approach that works best in personal relationships will work here as well – be yourself.
Along with your open approach, make sure to provide the client with the best service. Luxury real estate buyers and sellers expect a high level of dedication from the agent. If you can provide that while being genuine, you’ll have the right recipe for success. (from Jamie Amerman of Kuper Sotheby’s International Realty)
12. Make Your Expertise Known
Once you know which specific problems you are qualified to solve, get out there and start educating your prospective clients. High-net-worth individuals likely desire a deeper knowledge of real estate investing, 1031 exchanges, recent zoning changes, tax write offs for second home purchases, or development opportunities—and you can be the one to teach them all of these things.
Position yourself as the real estate educator and local expert by creating a quick 30-45-minute workshop. You can do it in person (in an office setting or a local library), but also be sure to advertise it on social media ahead of time. Set up your phone to livestream the class as well so that your name and brand is getting out there in more than way. Ideally, you want to share all the ways that they can solve the problem without telling them exactly how to do it. After all, you still want these high-end clients to need you for your services. End with a simple call-to-action: If they would like to learn more, they will need to schedule a meeting with you one-on-one.
Focus on educating without getting anything in return. Even if you don’t set any meetings after the first class, you will eventually become a trusted authority on your chosen subject, leading to opportunities in the future.
13. Search for FSBOs & Expired Luxury Listings
Luxury homes can take 2-3X longer to sell than the average home because fewer people can afford them or the luxury lifestyle they go hand-in-hand with. Plus, many are custom-designed and have unique features only the original owners see the value in, making them more difficult to price correctly the first time. Some luxury listings can sit on the market for years and change listing agents several times before they even sell.
Hint: You don’t necessarily need to close your first luxury listing to get started—you just need to get it, and more will follow.
Luxury FSBO sellers can also find it difficult to attract “real” homebuyers for their premium-priced homes. They often don’t want to budge on the price point, as they tend to focus on the work they put into the home. That can lead to the property sitting on the market for a long time, so this means that there is opportunity for savvy agents to prospect for both luxury expireds and FSBOs.
RedX is often a great tool when trying to find these properties. Because you are approaching these sellers unsolicited, present yourself as an ambitious (yet professional) luxury real estate agent who offers the ultimate solution to their problem of wasted time, since their property’s “days on market” are likely to be higher than the average property. Know your numbers, deliver them a promise, and follow through. This is a great way to get your first luxury real estate listing.
14. Claim New Constructions
Hustling to become the go-to representative for a new residential development project is one of the fastest ways to assert yourself in the luxury real estate market. If a developer has one project and likes the work you’ve done to sell it, chances are they’ll invite you back for another one…and then another one. Suddenly you’re the one they turn to with each new set of new builds.
The hard work it takes to get the listing and to do well with it will pay off in spades. It’s a mutually beneficial relationship that can grow and develop over time. Make sure you don’t blow it by being unprofessional, or letting it sit too long. There will always be another agent looking to swoop in and take your spot.
Bottom Line
The luxury real estate market requires an honest, informed, and delicate approach to your clients and the deals you make. Follow the expert advice provided here and hone your skills. At the end of the day, your success in luxury real estate will depend on the effort and care you put into it.
In this new era of an ever changing industry, many things will look different, and it’s hard to predict what may come next. In the luxury real estate market, you will need to rely on your marketing prowess, boundless creativity, and informed expertise to help you and your clients navigate this new environment. Keep an eye on the trends to stay relevant and build your list of high-income clients.
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