The coronavirus outbreak and prolonged shutdowns have forced just about every homebuyer in the country to reconsider priorities. In the luxury market in particular, space and amenities are two of the biggest forces driving the kinds of home that will sell fastest.
Aaron Kirman, president of the estates division at Compass and a reality television star from CNBC’s “Listing Impossible,” says this trend is no different in the wealthiest sectors of the Los Angeles market, even among celebrities. Once considered the single most important driving force of real estate values, location is now taking what could be a long-term backseat to home type and features.
“People are looking for those larger lots that are now so much more important,” Kirman told Inman. “They are willing to forgo some A-plus locations for areas that are able to offer some of the amenities that you can’t get in Beverly Hills or Bel Air.”
Inman sat down to chat with Kirman about the pandemic, Los Angele’s celebrity and luxury markets, and why agent self-care is more important than ever.
Inman: What has your team been up to over the past month? The market is hot but the challenges are also significant.
Aaron Kirman
Aaron Kirman: Surprisingly, it’s rocking and rolling. When the pandemic happened I was like everyone else and concerned that it would shut our market down or really change its dynamics. Who knew that it would actually increase our sales? Over the past few months, we’ve actually doubled our sales patterns. So, we’ve been really busy selling and moving and shaking. I think that the pandemic made people realize that home is one of the most important aspects of life. People who weren’t really happy with their living arrangements decided that it was time to make some changes.
What kind of people are buying? Now that the idea of waiting out the summer in a nice house is coming to an end as fall approaches, who’s looking to buy a luxury home now?
I think that’s actually still a thing. We see a lot of people moving and trying to make the changes that they thought were necessary for life improvement. Also, interest rates are so low that a lot of people are trying to taking advantage of that. The market is so hot right now that people are taking advantage of selling houses at high prices. People from all over come up. We’re not seeing the same L.A. buyers all the time anymore. We’re seeing a lot of people who live in cities and do not want to deal with COVID and another winter.
What we’re not seeing is the same level of foreign activity that we once did. As our borders remain closed to a lot of countries, we’re not seeing the same level of international buyers that we once had. So our market is basically a domestic market right now and it is surprisingly strong considering how much it once relied on global buyers.
What are some trends you’ve observed in L.A. luxury?
Outdoor space is really important. L.A. was getting quite good at vertical living. We’re noticing the trend sweeping back and getting really residential. Because of space, suburbs are getting more popular. In the uber-luxury space, lot size is very, very important. And the more amenities that a house can offer, the better, just because a lot of things are still closed. The things that were at one point luxuries are today necessities.
You work with a lot of celebrity clients. Do their buying trends reflect the rest of the luxury market, but magnified?
It has been magnified. A lot of our celebrity clients have reached out looking for bigger lots and more privacy. A lot of them are looking to leave A-list areas and go into areas that are still A-list but maybe not quite as expensive. We’re seeing a lot of people that are very well-heeled leave Beverly Hills and Bel Air and maybe go to areas like Sherman Oaks or Studio City.
Again, people are looking for those larger lots that are now so much more important. They are willing to forgo some A-plus locations for areas that are able to offer some of the amenities that you can’t get in Beverly Hills of Bel Air. That is a huge trend we’re seeing.
We know that you practice meditation. Is that something that you’ve been doing during the crisis?
Yes. I always say that if we can live life well, our business will follow and be just as nice. So I always try to practice what we preach. Number one is self-care. I think that when we take care of ourselves, we can take care of our clients better and when we take care of our clients better, we tend to build long-term strategic relationships that last a lifetime. I also think that in times like these, our world needs leadership and good communicators. I tend to view myself as an educator more than anything else. We’re here to educate people accurately and honestly so that they can make educated decisions that are going to be right for them. Our number one approach is to be as logical as we can and tell it like it is.
How do you toe the line between being honest and optimistic?
It’s really tricky. We have a very tricky job in real estate because sellers want to hear what they want to hear to hire us and then we have to perform in order to actually be successful. And so finding that line is always very complicated. It only takes one person to buy a house so, when it comes to how we proceed, there’s never a right and there’s never a wrong. We kind of have to play the cards and know the numbers and go from there.
How can other agents practice self-care and take care of themselves right now?
Our business is a 24-hour, seven-days-a-week business. If I let myself, I could be on my phone from 6 a.m. to 12 a.m. Number one, boundaries. We need to let our clients know what our boundaries are because every seller is going to say that their house is the most important and to them it should be. But as I always say, if you’re not happy, you’re not healthy. If you’re not living in the right space, there’s no way that you’re going to be good for other people.
What we do is all about bringing energy to other people. Everybody has a different self-care formula. Some go to the gym, some go to church or temple, some need to go into nature or spend time with family. Whatever the self-care is, it should be done. If agents are happy and healthy and living vibrant, clients are going to feel that energy and that energy is going to tap into making money.
