Real estate has always been one of the most stable and sought-after investments on Earth. With the Philippines’ variety of vacation destinations, thousands of exciting tropical islands, and a relatively affordable standard of living compared to the rest of the world, purchasing real estate, especially a luxury investment house, makes for an excellent addition to anyone’s portfolio.
In this article, we’ll be discussing the advantages of buying a luxury investment house, just like the ones that Brittany proudly offers to its esteemed clientele.
The Definition of a Luxury Investment House
Before we go any further, it’s crucial to understand how exactly a luxury property is defined by today’s standards.
First and foremost, luxury properties are not all price tags. While price is a significant factor, it’s by no means the only one. There are a variety of factors at play when deciding what constitutes a luxury investment house.
Luxury properties are mainly defined by their uniqueness and exclusivity, which raise far more value than the cost of the construction and materials alone.
Just like how anyone can draw a picture, anyone can also invest in an expensive house. However, it takes real skill and dedication to compose an image with the same kind of artistic quality as da Vinci’s Mona Lisa or Van Gogh’s Starry Night. This same principle of exclusivity and uniqueness is what gives a luxury property its true value.
In high-class works of art, one might take into consideration the artist’s skill in the brush, the style by which the colors are applied, and the overall meaning of the piece.
For luxury properties, one might consider location–the residence’s proximity to another luxury home, to the community, and to famous and storied parts of a city all contribute to the value behind a luxury investment. This is the case for trophy addresses such as New York City’s Park Avenue and Los Angeles’ Hollywood.
Portofino in Vista Alabang, which sits just a few minutes away from the city’s hottest go-to destinations
Proximity to high-end activities also plays a role, such as how near the luxury house and lot is to shopping districts, museums, fine dining, and centers for art. Sometimes people want panoramic views of beautiful landscapes, such as lakes, oceans, rivers, mountainsides, or countryside views.
Aside from location and proximity, luxury properties are also defined by their features. Luxury homes may contain the same features as all other homes do, but they do so on a much more high-quality and grander scale.
Security and privacy are emphasized, to the point of exclusivity or exclusion, as in the case of Brittany’s ultra-exclusive enclaves. Beauty should be present in the form of custom architecture, interior design, and unique materials.
A clean, bright bedroom inspired by Brittany’s quest to exude beauty in every detail
Luxury homes should also be equipped with the best kinds of amenities money can buy. A full-range chef’s kitchen, walk-in closets, outdoor spaces, and large pools are usually sought after, to name just a few. There are also smart security features, motion detectors, sustainable energy, high-end wine cellars, and home theaters that greatly enhance the feeling of luxury for a home.
Overall, luxury properties both stand out because of their uniqueness and similarity to typical homes, as paradoxical as that might sound. Luxury properties must seek to be unique in their design, utilization of space, and overall effect. Yet like so many others, it seeks belonging, such as being in a good community and having the same kinds of amenities that most houses are working towards, such as privacy and convenience.
All of these traits are, of course, displayed by every luxury home in the Philippines that Brittany develops.
The Benefits of Buying a Luxury Home
There are definite advantages of purchasing luxury homes as investments. Here are 7 benefits of buying a luxury investment house in the Philippines!
1. Offers More Control than Other Types of Investments
Luxury properties offer more control than other kinds of properties in your portfolio.
You’re free to choose the type of luxury investment to buy, whether it is a single-family home, a townhouse, a waterfront villa, or a condominium unit. There is a wide variety of property types in the market at any time.
In addition to this, you’re also free to do with the physical property as you wish. You can keep it as it is and wait for the value to appreciate in time, or you can flip the property and sell it for more than the amount you bought it. Currently, one of the most typical investment routes is to rent the property out as a luxury rental place.
This is in marked contrast to other security types, such as stocks and bonds, where the market forces are always beyond your control and there are a limited number of things you can do with your investments.
2. Involves Less Risk
Property investments, in general, don’t carry as much risk as paper investments, like stocks or bonds, especially when investing in the long term.
Equity and home prices build up over time because they are physical assets. This is unlike stock investments, which are held up by a nebulous force and could drop in value at any time.
3. Assured Capital Growth
The rise of an asset’s value over time is called capital growth, and this almost surely happens in real estate investments. As space becomes more scarce in the physical world, the value of every real estate property is sure to rise, so one can get a relatively safe investment through luxury real estate.
The difference between the current value of the property to the amount paid to acquire the property is how some investors raise their wealth when they eventually liquidate the property or in some way monetize it.
4. Lucrative Rental Opportunities
The Swiss-inspired rowhouses at Crosswinds Tagaytay, a perfect example of prime rental areas for tourists and visitors
Luxury investment properties are a prime asset to become luxury rentals. If you own several properties that have the luxury characteristics described above, you could easily find plenty of customers willing to rent a beautiful, exclusive place.
Big events such as weddings and the like can be a lucrative market for this since they can leverage the luxury aspect of the property nicely.
Also, the rental industry is one of the most controllable businesses in the real estate industry. As a landlord, one has the power to set the prices, and customers are always willing to dig deep into their pockets for the best properties.
Luxury homes for sale that are located in a picturesque setting, are near to local businesses, are located close to a transportation hub, or are equipped with unique and high-demand amenities, just like Brittany’s luxury developments, are prime properties to be rented out to willing customers.
5. Acquire Tax Benefits
Tax benefits for luxury properties could exist in the form of deductions on property tax, lower mortgage interest rates, and depreciation benefits.
Although tax breaks shouldn’t be the main strategy when looking to profit from an investment in luxury houses and lots, it is nevertheless an important tactic that can add some income to your cash flow, or at least reduce expenses. Always consult with your dedicated tax advisor to know which tax benefits may apply to you.
6. No Need to Worry About Resale Values
Luxury homes that enjoy high-value features, such as an excellent location, exclusivity, proximity to important places, or have an interesting history, are going to have a better ROI than other forms of assets.
While it might be somewhat affected by the conditions of the market and of the home itself, the value of a luxury home will generally always be on an upward trend provided that one takes care of it properly.
7. Provides an Effective Inflation Hedge
As mentioned, the value of investment property tends to rise over time, and can better keep up with inflation. As the cost of living rises, the value of investment properties also rises.
This helps investors because the value of their property will never be behind inflation, and one can justifiably raise rent or lease prices if applicable. More than that, mortgage payments are pretty much standardized. This means that mortgage payments will most likely remain the same even as the value of money decreases, decreasing the relative value of the payments as well.
In short, inflation is a benefit to–or at the very least will not harm–luxury property investments.
Tips in Buying a Luxury Investment House
Luxury homes are an excellent investment opportunity for those looking for low-risk, high-value assets to add to their portfolios. However, it is hardly the easiest industry to get into.
It’s important to have a clear idea of what you want to achieve in any form of investment, but particularly more so in investment properties.
This is because, unlike other forms of assets, you are most likely going to live in and interact with the luxury properties that you have. Therefore, you’ll have to take your lifestyle into account when making an investment in a specific area.
The Clubhouse at the Georgia Club in Brittany Sta Rosa
A luxury vacation house, for example, can act as an investment property, but you might also want to use it from time to time. That’s why choosing investment luxury homes that you yourself would want to live in based on your lifestyle and preferences is ideal. In other words, before you purchase a luxury investment house, be sure to think about where you personally want to live and what activities are most preferable to you.
Have a Clear Understanding of the Risks
There’s no such thing as a sure investment in this world–just take a look at the 2008 housing market crash in the United States. Knowing this right from the get-go can save you a lot of trouble and pain later should things go south.
This is true for any kind of investment, but it’s especially applicable to real estate assets. Remember, real estate assets are not as liquid as paper assets, so they are harder to get rid of equitably if things should go badly.
Always Hire Local Experts
Unless you’re a seasoned real estate marketer yourself, you are better served hiring the services of an expert in the market that you wish to invest in. Of course, you can always learn by yourself, but it’s going to require time and attention that could be put to better use elsewhere. Local experts will be more knowledgeable about the market that you’re getting into without you having to exert too much effort on your part.
However, it’s important to hire a reputable broker or adviser, preferably from a reputable agency. Everything considered, some individuals and agencies will work for your benefit, but some will not. Make sure you know the difference between the two.
Add an Attorney to Your Arsenal
Mortgage companies and real estate firms are doubtlessly invaluable when choosing an investment property, but they can’t handle everything. Properties like coops and condos will inevitably involve more rules and regulations, which means more paperwork and legal things to consider. Running important documents through an attorney is going to make sure that you don’t miss anything that could lose you money or time down the road.
Benefits of Buying a Luxury Investment House
Aside from being fantastic places to live in, luxury homes are excellent investments to have. People are always willing to pay for a taste of beauty and luxury, and as an investor, it could be you providing them that commodity.
More than the cash flow that you can get from either selling your luxury homes or renting them out, they are also valuable assets to hedge against inflation, or even acquire tax benefits.
Interested in buying a luxury investment house now? Take a look at all the properties we have to offer here at Brittany!