Pros and Cons of Buying ‘Trophy Home’

The grand family house has 4,500 square feet, six bedrooms and, among other luxuries, an exercise suite.

And Art Godi, former president of the National Assn. of Realtors, admits to loving the place, although only one of his four children, a 17-year-old son, still lives at home. Godi, 61, loves having guest quarters for his married offspring, not to mention his three grandchildren. Then, too, there is the spare bedroom where he can store his golf clubs.

“I’m not the moving type,” says Godi, who has difficulty admitting that he lives in what’s come to be known as a “trophy home.”

Although the average American family resides in a home with just 1,500 to 2,000 square feet of living space, many would prefer a much larger place if they could afford one, Godi believes.

Indeed, the new “McMansions”--as some have branded the new megahomes--are multiplying across the landscape. That builders are willing to build so many oversized houses is at least one rough indicator that the demand is there.

What constitutes a “trophy home?”

By Godi’s definition, it’s a home with more than 3,000 square feet of living space in a handsome setting, often with a beautiful view. An increasing number of trophy homes are waterfront places or are set on golf courses.

Internally, the new trophy homes--what Godi calls “show homes”--have a lot in common. Nearly all have huge master bedroom suites that include large bathrooms featuring Jacuzzi-style tubs, skylights and other appointments. Many rooms are equipped with walk-in closets and an abundance of other storage space.

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In addition, they include recreational components, such as entertainment rooms with large TV screens, wet bars, private gyms, and extensive play areas for young children.

“I think there’s always going to be a market for fine homes of good quality,” said Carol Aiken, a broker-associate for the Re/Max realty chain.

But will all huge homes hold their value, or appreciate well? Not necessarily, Aiken cautions the would-be buyer.

Aiken warns that homes at the extreme end of the size scale--more than 8,000 to 10,000 square feet--could become “white elephants” in the future. Such properties can be tough to sell because there are fewer people willing or able to move to such enormous housing units.

“Extremes in anything are not a good idea,” she said.

Still, she agrees with many real estate specialists that demand for large houses will remain strong in the future, even though the nation’s population as a whole is aging.

Why? Because many Americans of all ages covet the dream of upward mobility and greater comfort, so long as they can afford it. Relatively young households enjoy spacious living, and childless people with few tax shelters but plenty of income often have a special appreciation for the tax deductibility of the mortgage interest on an expensive property.

“The home mortgage deduction gives people a great tax write-off that’s hard to get almost any other way,” says Nancy Dickey, who sells homes through the Coldwell Banker chain.

A swath of the population still in their 20s and 30s can now afford a trophy home, due to their success in high-tech enterprises or through prudent investments in the bullish stock market of recent years, Godi noted. “It’s not unusual anymore to see a guy who is 30 driving a Porsche or living in a 5,000-square-foot house,” he said.

Many in the baby-boom generation, which has already entered its 50s, are acquiring or keeping trophy homes even after their children have gone off to college or graduated, Godi said. That’s because the pursuit of upward mobility is a constant with many people, regardless of age, and ownership of a trophy home makes a status statement.

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Of course, the elderly often have trouble maintaining a large estate property and may have to give it up, according to Godi. Yet some well-to-do people trade down in terms of space, but rarely in terms of comfort. Perhaps they’ll give up a house with a large yard, for instance, in favor of a penthouse condo-apartment.

And although the senior population is expanding, real estate specialists believe that the demand for large houses will continue, given the dreams of many young immigrants who see huge homes as compounds for their extended family units.

“Many immigrants are used to a larger family circle,” said Carol Aiken of Re/Max.

Here are three pointers for those considering the purchase of a trophy home:

No. 1: Make sure the quality of the home matches its size.

To be sure, many trophy homes are brand-new properties with a grandiose look to their exterior. But unless they’re well-designed, well-built and well-appointed, they’re unlikely to hold their value, warned Coldwell Banker’s Dickey.

“Just because you have a 4,000- to 6,000-square-foot house doesn’t mean that equates to a high price,” Dickey says.

Those with the money to buy a trophy home will want interior extras, such as hardwood floors, upgraded kitchen cabinets, and fine counter tops in kitchens and bathrooms, for example, she said. Also important is a floor plan with a central hall so that you don’t have to walk through a dining room to get to the living room or kitchen.

Still more basic is the quality of the construction of your trophy home. Dickey suggests you investigate the builder’s quality of workmanship--perhaps by hiring a home inspector--before you invest in a new minimansion.

No. 2: Keep the size of the grounds in scale with the interior dimensions.

Unless you live in a highly coveted city neighborhood, where your superb location is everything, you’re going to want a real yard around your trophy home.

In most cases, those who seek a huge houses eschew the notion of a “zero lot line” property, where the properties virtually adjoin each other. On the other hand, having too much acreage--more than an acre or two--is a turnoff for many buyers, who are too busy to maintain their grounds or to hire someone to do it for them.

No. 3: Remember that a dream home offers flexibility, but not happiness.

Godi, who owns an independent realty company, lives in the same town where he grew up. And while he owns a huge home there, he says the family he grew up in was just as happy in a tiny house.

“My folks never lived in a house with more than two bedrooms and one bath and that didn’t make any difference to our family,” he said.

Attaining a trophy property can buy you privacy, comfort, and the flexibility to entertain guests. But it won’t buy you peace of mind, especially if your house payments are a strain. “Remember that the house per se doesn’t create either sadness or happiness. It’s what goes on in the house,” Godi said.

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Distributed by Universal Press Syndicate.