Psychological Factors affecting purchase of Luxury Real Estate

Purchasing Luxury Real Estate is not a cup of tea for everyone. There are a lot of factors that play a role while a person decide to purchase a Luxury home. The appeal of Luxurious homes is undeniable. There is a great percentage of people who always want to live in a home which is located on a prime location, which has all the facilities and luxuries, and off course, it has to look pleasing to the eye. There is a portion of the population who never go for Luxury homes based on number of reasons. Majority of that portion is not financially strong to afford luxury living and the rest of the people opt to spend their money somewhere else. They are comfortable living in a cheaper and not so luxurious home.

Let’s talk about the people who decide to buy Luxury Real Estate. There are several Psychological factors that play an important part in that decision. Those are discussed below:
Self-Esteem
A recent study which was published by Journal of Experimental Social Psychology showed that low self-esteem plays a big role in whether a person decide to buy luxurious goods. They are of the opinion that if they buy something that is expensive and luxurious, it will increase their self-esteem.
Social Status
People who want to maintain a high class social status always want to spend their money for luxury homes because it’s their belief that luxurious home will always define their high class social status. People think that their peers will respect them more if they are living in a luxurious house. It’s one of the factors which comes in their mind when they are making a decision about buying a luxury home or not.
Also people are used to rate a product high if they are told that this product is expensive. So it’s always in the mind of people that if a particular thing is expensive, it must be high quality and highly rated. Same is the case with Luxurious homes because people will know that they must be great because they are expensive and tagged as “Luxurious”.

Another scenario is when people who are not that financially strong to afford a luxury lake home, still decide to go for one because they want to show off to others, try to get acceptance from others or to reward themselves for an accomplishment.