Living the life of luxury in Hollywood and beyond may seem like a dream for celebrities, but stardom may not play out in their favor when it comes to the real estate market. In fact, celebrity homes tend to stay on the market longer than the average seller's property.
The fabulous pools, guesthouses, and in-home theaters that are often part of the celebrity home package sure sound great and luxurious, but not to the average homebuyer. A recent analysis by residential real estate company Redfin suggests that celebrity-owned properties aren't near as sought after as celebrities themselves are, but instead tend to stay on the market longer than "non-celebrity homes."
The analysis tracked many different variables of celebrity homes, from the surprising to the not so surprising. According to the data collected from Redfin, celebrity homes unsurprisingly boasted both larger bedrooms and bathrooms than other properties. Additionally, star properties cost more per foot than other, nearby abodes. The surprising factor, however, was that on average, celebrity homes were found to have stayed on the market for an average of 36 days longer than other homes. Another blow for stars looking to sell? Even when celebrity property is closed on, it often is sold for below – and sometimes well below – the original asking price.
So what is the reasoning behind the dim real estate market for those on the A-list? As a firm that provides a web-based real estate database (along with brokerage services), Redfin pointed out that the high taste often sought after and afforded by celebrities isn't necessarily ideal to the average real estate customer. For example, future homebuyers aren't necessarily looking for basements with basketball courts, Olympic-sized pools, or their own home nightclub. While these high-end add-ons may sound appealing to a certain celebrity stature, Redfin suggested that they might be anything but to the average homebuyer.
Another problem that can occur when one of Hollywood's elite lists their property may very well be just getting serious buyers in the door. Unlike a normal home on the market, property-seeking parties may have to participate in an extended and complicated vetting process in order to tour a celeb home. When it comes to a home belonging to a star, buyers can simply forget about an open house.
Because of the extra hoops and complications that go into an A-lister ensuring a sale on their latest listed property, time isn't the only thing that is often lost in the process. Despite high initial price tags and dreams of grandeur, even the most elite may be less than impressed with the final offer. In fact, data gathered by Redfin suggested that celebrities may actually be more likely to settle with a lower to significantly lower sale price than they had originally hoped for.
In some cases, celebrities even found themselves settling for more than $1 million less than their initial asking price. For example, Jessica Simpson ended up biting the bullet when she listed her Beverly Hills home for nearly $8 million and ended up setting for $1.595 million less than she had asked. Likewise, actor Matthew Perry ended up netting $2.85 million less than the initial $25 million that he listed his Malibu home for when he sold it in 2015.
To track the seemingly unfavorable real estate results for celebrities, Redfin compiled data on the purchase and sale of 60 celebrity homes and compared it to homes within 500 meters of the same properties that sold within the same year of the nearby celebrity property.