luxury Beverly Hills home for sale with a pool
Image courtesy: themls.com

Top 5 Reasons to Invest in Beverly Hills Real Estate

Real estate provides one of the few investment opportunities that allow investors to reap more than they put in. For example, if you want to buy shares in an organization, you cannot do so if you don’t have the money upfront.

With property, on the other hand, you can acquire money for investment from banks or other financial institutions. In other words, you can make your future in property, provided that you know which ones can prove lucrative, which locations are profitable, and what type you should invest in. By buying up Beverly Hills luxury homes, you can more than triple the amount you invest by selling them to the highest bidder!

Once those prerequisites are accounted for, here are some benefits you can expect from investing in luxury homes in Beverly Hills.

#1 Appreciation and Cash Flow

Most investors who buy up real estate do so expecting it to appreciate by about 3% to 4% on an annual basis. However, the real benefit is not just appreciation value; it’s that plus the cash flow you can get. That is possible if you decide to put up the property for rent. In other words, even in an inflated market where the purchasing power reduces, you can still make a considerable sum of money each month.

It’s exactly because of this reason why buying Beverly Hills property is considered to be the best investment option that appreciates in value compared to others. Plus, the investment value increases as the net operating income of the property improves with rent and effective management.

#2 Tangible Value

Unlike stocks which are valued on speculations and forecasts, real estate has real intrinsic value. In other words, it is useful due to its very nature. For example, if you invest in a land, you will be able to provide space, build structures on it, farm on it, or even sell it to someone else. If you own real estate on that land, you will have a source of income that will keep increasing in value which can entice other investors.

Plus, unlike the stock market, the value of Beverly Hills real estate investments does not oscillate as drastically since it is not affected by mass hysteria. In other words, you aren’t going to wake up one day destitute because your home is worth pennies.

That is exactly what happened to Enron, a former Wall Street darling whose stock fell from $90 per share to $0.12 in a single year. In contrast, if a property is maintained and managed well, you can expect a high ROI. The point is unlike stocks: you can trust the value placed on a piece of real estate and even multiply your initial investment a hundredfold.

#3 Consistent Income

One of the most obvious, but surprisingly overlooked, areas of real estate is the income flow you can enjoy. While you can expect about a 2% yield in stocks and bonds, with real estate you can generate significantly more without selling it. In other words, you will have a steady cash flow in the pocket while the asset increases in value! It’s a win-win situation as far as investors are concerned.

Think about it. You will already have money when you are renting or expecting to sell and more money when you decide to go for either option. Besides remaining steady, this income will also adjust with inflation.

For instance, with each new lease for, say, multifamily apartments, you can increase the rent rates for inflation so you and your assets will be protected. Compared to stock, you will only be making more money if the revenue from operations and sales increases significantly which can take more time, effort, and resources.

When someone rents an apartment, they pay close to market rates. Since the leases generally secure the assets, you can get a regular income stream that is rated at a higher value than stick dividends can yield.

#4 Inflation Hedge and Savings

Taking up the point about inflation again, as a real estate owner in Beverly Hills, CA who rents out to tenants, unlike renters you will not have to deal with the reducing dollar values like renters will have to. In fact, your properties will likely rise in value due to inflation which makes it a better alternative for stashing your money than banks where it may depreciate in value if the currency does.

Conversely, even if you buy a home that you pay a mortgage for, you will force yourself to save. Every month, a part of your payment will be directed to the principal balance if you have a mortgage that is fully amortizing.

What this does is force you set a certain amount aside every month for the whole term of the loan or till you sell. If you are terrible at maintaining a nest egg, a mortgage can ensure you do whether you want to or not. Plus, when the time comes to sell, that money will increase the value of your home which can give you a better price than what it is worth.

#5 Pass it along

Perhaps the best benefits of owning a property or home are the prices that come with it. As opposed to renting where you are at the mercy of landlords and inflation rates, you are the boss of your own domain and you can make changes to it as you see fit.

Plus, it is a tangible and valuable asset that you can pass on to your children or family members especially if you fall in love with the property you own. Consider it a legacy that you shed blood, sweat, and tears working hard to acquire and which can stand as a testimony to your dedication.

Why You Should Invest in Luxury Beverly Hills Real Estate 

What Defines ‘Luxury Property?’

Before you invest in a luxury Beverly Hills property that will definitely have a high price tag, you should understand what ‘luxury’ means in real estate. Traditionally, a luxury property used to be a property that is exclusive, unique, and desirable. However, there is no set checklist that defines it today even though many features are common in upscale ones in major cities such as LA.

Often, it is the unique features that set apart luxury real estate from others. In major cities such as Los Angeles, properties that are designed by renowned architects are at the top of the list for most investors. It comes with prestige, one of the top two priorities that today’s real estate investors seek.

The other one is based on your needs as a real estate investor or if you wish to buy a home in Los Angeles for the first time. It can be anything from ensuring that the property can be managed from abroad easily, services that you want to make that maintenance easier to extra space that can be used to entertain guests or a state of the art kitchen.

Of course, like all real estate, the location has a lot to do with how valuable the property is. Luxury properties usually attract high-end buyers who want access to equally lavish activities. This includes access to high-end shopping destinations, dining, arts, and, of course, close proximity to neighbors who are as affluent as they are. Some also prefer properties near natural attractions such as large lakes, beaches and in the countryside.

What differentiates high-end Beverly Hills buyers from others is that they want properties on a large scale and ones which can provide more privacy and security. This includes bespoke features such as custom design, opulent finishes and custom architecture that can set their investment apart. Extra opulent amenities such as master suites, outdoor living areas, luxury pools, car lifts, and temperature-controlled wine cellars are just some of the features that they get for an investment that they can sell for way more.

Why You Should Invest in Luxury Beverly Hills Property

Beverly Hills and Los Angeles as well is not a cheap place to live by any stretch of the imagination. So why should investors invest in luxury real estate when they can get the same size one in a cheaper city? The answer is the return on investment. The bottom line is that if you want to make more money in real estate fast, you need to have real estate on your portfolio.

The fact is that investing in property requires more than making a deal with a broker. Smart investments appreciate in value over time which you can benefit from in this city. In LA, median home prices have increased by about 6% a value that is expected to increase. As the market improves, you should buy now to ensure you get the best deal.

2018 was a great year for real estate prices in Los Angeles and even though there may be a slight decrease in the coming years, those prices will only keep growing albeit at a slower rate. This spells good news for luxury property investors since rising prices will be met by rising home values. In other words, you will see a significant increase in your initial investment in time.

You will also have access to a larger renter pool that will rent rather than buy a home in Beverly Hills due to rising costs. The more tenants you have, the more potential tenants you can get access to.  This is one of the main reasons why investing in real estate in the city is so lucrative and stable.

Besides this, another aspect that ensures stability in these investments is the fact that real estate values in luxury properties will always increase with time. That’s because irrespective of how well or not the market is doing, these properties will still hold up and perform well compared to traditional investments or stocks which rise and fall with market values. Luxury properties rebound when the market slows down because of its unique position which it gets from its high-end features. These overcome the cost of replacement, making such investments more desirable than their traditional counterparts.

In other words, when you are seeking an investment in Beverly Hills real estate, you can breathe easy knowing it will pay off.

inside view of Luxury Beverly Hills home
Image courtesy: themls.com

How Pezzini Luxury Homes & Mansions Can Help

Buying real estate in any shape or form is the biggest investment you can make in your lifetime. Luxury options can cost significantly more but with the right investment and advice, you can earn back that amount ten-fold.

If you wish to invest in high-end Beverly Hills real estate, contact us at Pezzini Luxury Homes, one of the top Beverly Hills real estate agencies at +1-310-275-2076. We are the main source for real estate data in not only Los Angeles, but also Bel Air, Brentwood, Beverly Hills, and Malibu among others. We offer an extensive and categorized list of luxury properties in California that range from homes and condos to multifamily apartments.

With our help, experience and advice, you can find a hidden gem that can pay for itself over time and provide an opulent residence at the same time. Invest in prime locations such as Doheny Estates, Laurel Canyon, Mount Olympus, and Lake Hollywood to make your portfolio stand out. Use our state of the art search tool to find properties in MLS listings that are currently up for sale or get in touch with us if you wish to sell real estate to high bidders. In either case, we will ensure you get the best value for your investment.   

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