When people hear the word “art,” a luxury home typically doesn’t come to mind. Instead, people associate art with an exquisite painting or a lavish sculpture. Many people may not consider residential real estate to be part of the “art world,” however, when you look at luxury homes and fine art side-by-side, the similarities are astounding.
While residential real estate is not technically considered art since a home serves a function and art does not, it is not a stretch to say that a luxury home contains artistic features and components. Luxury home appraisers are expected to translate this exceptionalism into value, much like a fine art appraiser would appraise a piece of art, supporting a value opinion through careful research and analysis. In this way, luxury home appraisers and fine art appraisers share many things in common in terms of what they consider when appraising.
According to Sotheby’s “The Value of Art” series, in general, fine art appraisers take ten criteria into account when appraising a piece of art:
- Authenticity
- Condition
- Rarity
- Provenance (history of ownership)
- Historical importance
- Size
- Fashion
- Subject Matter
- Medium
- Quality
Even though authenticity, subject matter, and medium don’t really apply to luxury homes, it is astounding to see just how similar appraising a luxury home is to appraising pieces of art that you see hanging in museums all over the world.
It makes sense that luxury home appraising and fine art appraisal are so similar since there is a fair amount of crossover between the people who buy luxury homes and the people who collect fine art. Much like fine art collectors, high-end and luxury homebuyers purchase or build homes to showcase their wealth, individuality, and uniqueness. They want others to appreciate their home for its lavishness and exceptionalism; similar to that of an art lover who displays a revered masterpiece for all to see.
It’s this motivation for exceptionality and attention to detail that makes appraising pieces of art and luxury homes so complex, requiring extensive training and know-how on the part of the appraiser. However, while fine art appraisers often spend decades studying one particular artist or time period, luxury home appraisers are expected to be extremely well-versed in a variety of different architectural styles and high-end amenities and materials, all while taking the ever-changing real estate market into account. It is for this reason that luxury home appraisers are in high demand as automated tools and non-appraisers cannot handle the level of complexity that comes with valuing luxury homes.
As Frank Lloyd Wright famously said, “The mother art is architecture.” With this in mind, it is easy to see how appraising a luxury home is like appraising a piece of fine art—it just takes an appraiser’s especially-trained eye for detail and craftsmanship.
If you’d like to learn more about the “art” of luxury home appraising and the opportunities surrounding it, you can come to this free webinar on February 19th from 11 am to 12 pm EST.
Have any comments or would you like to submit content of your own? Email comments@appraisalbuzz.com.
