How to Afford a High-End House Without Being Rich

When someone thinks of luxury homes in San Diego, they likely think of beachfront properties that are valued at over $20 million. However, not all high-end houses have to be extremely priced. While some certainly are, there are plenty of houses that would fall under the category of being high-end that cost significantly less.

However, even the cheaper options when it comes to luxury home buying in San Diego are far from being a possibility for the average middle-class family. Luckily, there are several tactics that can be used to allow someone to purchase a high-end house even if they are not a multi-millionaire. Here is how someone can afford to buy a high-end house without having a ton of money.

Find Someone Struggling to Sell

As any luxury realty company in San Diego will tell someone, not every homeowner has an adequate assessment of what their property is worth. Some people grossly misjudge the value of their property and put it on the market at an asking price that is far too much.

What this will result in is it likely sitting on the market for several months at a time with little or no offers put in on it. After a while, this can start to be a big hassle in the homeowner’s lives, which may pressure them into lowering their asking price.

Determining which sellers might be more motivated than others can be a very beneficial for the potential buyer. The average high-end estate that is reasonably priced and put up for sale during the middle of a competitive market will often sell in less than a month. So if there is a particular property that has been listed for over three or four months without experiencing a significant price reduction, then this is something that may be a perfect opportunity for an individual looking to purchase a high-end estate without spending a ton of money.

Chances are that this homeowner will be willing to accept an offer that is much lower than their current asking price, especially if their original asking price has still not been adjusted. So while the property might originally be listed for $5 million, after several months of little to no interest being shown toward it, there is a good chance that the buyer might be willing to accept an offer that is at least a couple hundred thousand dollars less.

Wait for the Winter Months

When it comes to purchasing any place, whether it is a high-end one or not, timing is everything. When properties are in particularly high demand, homeowners will be far less motivated to reduce the amount of money that they will accept for their property. However, once the general demand for the property starts to decline, the selling prices of various high-end properties will suddenly start to significantly reduce.

Unfortunately, waiting for major market changes can often take a couple of years, if not more, which is something that not many homeowners are willing to wait for. Luckily, there are slightly less significant changes in the market that occur every year. Any good luxury realtor in San Diego will know exactly when the off seasons are for selling places in the area.

Most often, this happens to occur during the winter season. This is because the weather becomes not quite as nice, which is going to keep most people from venturing outdoors and looking at places for sale quite as often.

The other main reason the winter season is a good time to look for high-end houses to purchase is because it is near the end of the year, which can serve as a busy or motivational time for many people. For example, most individuals are going to be focused on spending their money for holiday activities rather than saving up for a new house. Therefore, while everyone else is purchasing their Christmas gifts, a savvy homebuyer could swoop in and snag a high-end property for a fraction of the cost that it would have been during the summer months.

The end of the year also serves as a goal for most people to get rid of their places and start anew at their other property. So if someone comes along and offers them a slightly lower amount for their property but agrees to take it off their hands before the end of the year, then they may just be willing to accept that to be able to give up ownership of the property before the new year starts.

Find Foreclosure Listings

Something that many buyers tend to overlook is the option to purchase a foreclosed property. When it comes to high-end properties, purchasing a foreclosed one could help them save over ten percent of the property’s original value, which can often be more than $500,000 in savings. Saving such a significant portion of money could be the difference between being able to afford a property and not being able to afford a property.

Some people shy away from looking at foreclosed properties because they are under the impression that they require a cash purchase, which is entirely untrue. The other main reason that can make some potential buyers nervous about foreclosed properties is that they are almost always sold in the exact state that they are in.

That means that if there is some work that needs to be done throughout various parts of the home, that will fall under the responsibility of the new homeowner, which may add a fair portion of money to the cost of owning the home. That is why it is important to get any foreclosed property that someone is interested in buying thoroughly inspected to know exactly what needs to be done throughout the house.

Use Money From Retirement Accounts

If it is really important to someone that they own a luxury home, then they could always borrow some money from their retirement fund. Anyone with a 401(k) plan can usually take out a certain amount of money as a tax-free loan. This can be the difference in the amount of money needed for the down payment on their ideal luxury home.