So You Want to Sell to a Millionaire?

It's a small, incredibly lucrative segment of the real estate market, and these four salespeople know how to cater to it--the millionaire crowd.

February 1, 2000

"The very rich are different from you and me," F. Scott Fitzgerald said to Ernest Hemingway. REALTORS® who service the tip-top end of the market don’t necessarily agree. "They're no different from anyone else," says Kathryn Hinds, a salesperson with Windermere Real Estate in Seattle. "They could be your next-door neighbors. It's really not about how much money they have."

"Do you treat rich clients any differently than regular clients?" asks Olivia Quist, a salesperson with Russ Lyon Realty Co., Scottsdale, Ariz. "I don’t think so. All customers want to know that you’re listening to their needs and responding to them."

Of course, some things are handled differently at the top end. Take closing gifts. Forget birdhouses and gift certificates. Hinds sends items such as Waterford crystal golf putters. And lunch and dinner tend to take place in some of the finer restaurants in town.

This month REALTOR Magazine takes you to four cities to look at the high-end market and find out what life is like for four salespeople who excel at meeting the demands of the high-powered.

Chicago: 'The buildings are like vertical streets'

There are layers and levels in the Chicago luxury market, says Joan Armstrong, a salesperson with Koenig & Strey. You can spend a million or two for an apartment on Lake Shore Drive and still, socially speaking, be in Siberia.

Armstrong is hyper-attuned to these sometimes minute gradations in status. "The buildings are like vertical streets, and each has its own character," she says.

Armstrong sells a very narrow segment of the market--mainly high-end co-ops and condos on the city's Gold Coast, a neighborhood about a mile north of the Loop business district and consisting of Lake Shore Drive and several streets to the west. She also sells a few apartments farther north in Lincoln Park.

It's a small, self-contained universe, so small that Armstrong, who has been in the business for almost 30 years, has never owned a car. In her early years, she used a bicycle to get to appointments. Today she takes taxis.

The housing stock on the Gold Coast is a mix of old and new buildings. Those that denote social status are a dozen or so pre-World War II apartment buildings, most of which are co-ops. Armstrong knows those buildings like the back of her hand.

"I really love the old buildings," she says. "Many of the apartments have passed through my hands three or four times."

She can tell you who lived where going back to the 1920s and also when the kitchens and baths were last updated and the condition of the parquet in the dining rooms and cavernous living rooms.

Part of what I bring to the table is my intrinsic knowledge of the buildings--who lives there, how it works, and what it takes to get in," she says.

That last is key. In a country so officially democratic, co-op boards are the last bastion of undemocratic privilege. Armstrong prepares clients for the grilling they’ll receive or--if she thinks it’s hopeless from the outset--guides them to alternative buildings.

The important thing, she says, is to make sure no one gets humiliated or caught unawares by the requirements of the different boards.

Armstrong says most of her business is referrals. "I don’t do much personal marketing," she says. She's also something of a nonconvert to technology. "The Internet may be the wave of the future, but at the level I operate, It’s immaterial," she says. "Usually I’m dealing with a businessman and his family who are coming to town, and that man isn’t going to sit down and surf the real estate Web sites. He's going to call somebody to take his wife around."

Armstrong, who says she works seven days a week, does fewer transactions than the average salesperson, but they take longer. "The details are what matter."

Savannah: 'If mama ain’t happy, daddy ain’t happy'

We're the ones people think of when they’re looking for unique, high-end real estate," says Cora Bett Thomas, owner of the Savannah, Ga., realty company that bears her name.

And Savannah has some of the most distinctive high-end properties in the country. The city, which was founded in 1733, was one of the first planned communities in the New World. The old city center is a series of elegant squares filled with Spanish moss-draped trees and boulevards lined with venerable antebellum row houses and mansions.

"The historic district is about two square miles," says Thomas. "That works out to about six miles worth of row houses. That's a lot of inventory."

Thomas began selling real estate 30 years ago and formed her own company in 1995. Last year her volume was about $50 million.

Like Armstrong in Chicago, Thomas has sold many of the grand properties more than once. "Each property has its own atmosphere and its own personality," she says. "After a while, you begin to know it intimately and can sense who’d be right for it."

Thomas has a high profile in town. "I serve on a lot of boards. I’m very active in organizations such as the Historic Savannah Foundation, the Telfair Museum, and the First City Club. You see people, It’s fun, and It’s also good for business."

Thomas says she usually carries about 50 listings, and "I never stop farming. You have to keep your inventory fresh. I cold call all the time. I'll be out driving and I'll notice some house that hasn’t sold for a while or is exactly what one of my buyers is looking for, so I'll get on the phone and say, 'Hey, this is Cora Bett. Are you interested in moving again?' They're not surprised when they hear my voice. And they always want to know what their property is worth."

Thomas deals with a lot of married couples and says appealing to the wife is key. "If mama ain’t happy, daddy ain’t happy. The wife definitely calls the shots after the first meeting. I don’t ignore the husband. If he’s a golfer, for instance, I’ll make sure to let him know what facilities are in the area, but the pitch is addressed to her."

Savannah society, like that in most cities, is a mix of old and new money. Thomas says the two groups tend to look at properties differently. "New money makes more demands regarding the quality of the property, such as nice kitchens and bathrooms. Old money makes more demands when it comes to architectural integrity."

Web site: www.corabettthomas.com

Seattle: 'You start around $1.5 million'

Think of Internet millionaires, and Seattle is bound to come to mind.

"We have so many high-tech companies that have gone public and done well, and the employees with stock options are retiring very young," says Kathryn Hinds, a salesperson with Windermere Northwest in Seattle. "Many of my million-dollar-plus customers are under 40.”

What do these rich kids want? The same thing the newly rich have always wanted: the mansions of the old guard. Forget what you’ve heard about Bill Gates' new shopping mall of a house. The young "digicrats" are buying towers, turrets, moldings, and balustrades, says Hinds.

Hinds sells in a handful of historic downtown neighborhoods such as Washington Park, Laurelhurst, Queen Anne, and Windermere, the same areas where the last generation of millionaires--founders and executives of companies such as Weyerhaeuser, Nordstrom, and Boeing--has long been ensconced.

Current inventory, she says, is "slim slim, slim. I had a referral last week, a young couple. They were pretty unlimited in terms of budget. And I had one house to show them."

The key for buyers, she says, is to be proactive. "If they see a house they like--even if It’s not for sale--I write a letter to the owners and tell the buyers to be patient. You never know when someone will decide to sell. I’ve sold more than one house that way."

Hinds sold 29 houses last year for a total volume of $37 million. She says she usually carries about five listings. Her highest sales price was a $6.4 million historic mansion. "Anything under a million means a house in need of remodeling," she says. "If you want something that’s ready to move into and with a little style, you start around $1.5 million."

Marketing at the top end, says Hinds, requires a light but lavish hand. "It's quieter, but everything--the paper, the photos, the copy--has to be of a certain quality. You want people to feel they’re getting something that’s worth $3 million."

One way to do that, she says, is to focus on history. "I had a listing recently that was on the National Register--a wonderful, stately 10,000-square-foot home for $2.7 million. When you have a house like that, you have to take the extra step and go down to city hall to see what you can find out about its history--when it was built, who the architect was, and who the owners were."

"The Internet is a huge part of our marketing," says Hinds, but only to a point. "People I deal with don’t want to waste time looking at everything that’s available in a certain price range. They want me to do that and then call them when I find something special."

Web site: www.windermere.com

Scottsdale: 'Four-car garages and views of the mountains'

The main advantage of working with high-end clients?

"It's easy to get them qualified," says Olivia Quist, an associate broker with Russ Lyon Realty Co., Scottsdale, Ariz. "Many of them pay cash."

Quist, a former college English teacher, is celebrating her 20th year in real estate. She began by selling luxury spec homes for a local developer in the town of Paradise Valley and went on to extend her reach to nearby Scottsdale and Phoenix. Her total volume last year was about $26 million.

The area is a desert resort and retirement community for the CEO crowd and also attracts a number of sports stars and other celebrities. Her past clients include Michael Jordan and real estate mogul Leona Helmsley.

"My job is to expose them to what we have and intuit what they feel comfortable with," says Quist. "Usually after I show them three houses, I have a good feeling for what they want."

Most start off buying a second house and then--as they get older and closer to retirement--move to a primary residence. "I get a vicarious thrill out of finding the right house for my customers."

Sometimes she literally takes the bull by the horns. Jerry Reinsdorf, owner of the Chicago Bulls basketball team, is a longtime client. "I sold him and his wife a house, and then a couple of years later the lot next to their house was going to be auctioned off. I advised him, and he told me to go to the auction and call him on his cell phone. I reached him at a Bulls game, and he wound up buying the lot over the phone."

Quist says the amenities that matter to her buyers are "fabulous kitchens, home theaters, luxurious master suites and baths, three- or four-car garages, pools and outdoor entertainment areas, and views of the mountains."

In many luxury markets, there’s a split between customers who want historic homes and those who like new construction. In Scottsdale, however, "almost everything is new because the town didn’t really get started until after World War II," Quist says.

She carries between 12 and 15 listings at a time. "I do the normal types of advertising," she says. "Color brochures, local newspapers, and estate magazines."

But just as at any other level of the market, chance and luck play a role. "I just sold a $2.4 million house," she says. "The architecture was contemporary, which made it a very tough sell. And it was on a hillside, so that eliminated families with young children. I really blew my advertising budget on this one house. And then, after 10 months, it sold on a drive-by call."

Robert Sharoff is an architectural writer for The New York Times, Washington Post, Chicago Tribune, and Chicago Magazine. With photographer William Zbaren, he has produced books highlighting the architecture of Detroit and St. Louis. He is a former senior editor with REALTOR® Magazine.

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