Ever wonder what it’s like for celebrities to purchase and sell homes? These stars’ homes are often hard to find — and for good reason, considering the ruthless paparazzi. But just because celebrities often have more money to spend than normal customers doesn’t necessarily mean every step of the process is easy. So, what is it like to buy, sell, or rent a home as a celebrity?
We spoke with three top agents — Mary Beth Harrison of Dallas, Texas and Ed Kaminsky and Anthony Marguleas of Los Angeles — to answer some interesting and revealing questions about celebrity real estate transactions. From the nondisclosure agreements to the business managers, it’s an often bumpy ride.
How do celebrities pay for their homes?
Just like normal customers, many celebrities take out mortgages on their homes. It all depends on their own financial situation, says Kaminsky, a top-rated Manhattan Beach agent.
“It’s whatever their financial advisor advises them at the time,” Kaminsky explains. “Sometimes financing is beneficial for them. Sometimes paying cash is beneficial.”
Because of their high-paying contracts, Kaminsky has seen celebrities with large incomes score loans that most people would not be able to get approved. He works primarily with athletes, and says that their long-term contracts are often beneficial in the eyes of the bank.
However, celebrities do usually purchase their homes through a trust with a name that’s hard to trace back to them. Because housing transactions are part of the public record, celebrities could put themselves in danger by putting their actual name on the deed.
Along with more than 30 years of real estate experience, Harrison has additional insights because she is mother to longtime “Bachelor” host Chris Harrison. She explains that it’s important to use a trust title that has absolutely no relation to the celebrity or their name.
“Using your last name is not going to help you, you’re going to need to put it in some other name of a trust,” she says.
Additionally, most celebrities and their agents require other real estate agents to sign a non-disclosure agreement (NDA) before sharing the details of the client. Marguleas, who specializes in luxury home sales in Los Angeles, explains that many agents who work with celebrities don’t sign NDAs when they should, which makes those who did stand apart from the crowd.
Often, word of celebrity home sales are leaked to the paparazzi by people viewing homes or nearby neighbors.
“So, an NDA, it delays the inevitable by a few weeks,” Marguleas explains. “But 99% of the time, it becomes public anyway.”
Do celebrities ever rent their homes?
Yes. Many celebrities prefer to rent instead of buy, especially if they need to live in an area for a short period of time such as a sports season or a movie shoot. Kaminsky, who works with many professional sports players, says that team rookies often choose to rent in case they’re traded to another team, which is common. Additionally, in a tough seller’s market, it might not be in the celebrity’s best interest to invest in a home right away, especially if they’re fairly mobile.
Other times, it works out in celebrities’ favor to purchase a home and sell it for a profit. For example, NBA coach Mike D’Antoni bought a house in Manhattan Beach for $6.9 million when he coached the Lakers for a season in 2012. He left for Houston not long after, but sold the house for $9.5 million.
“In a questionable real estate market, then I’m advising shorter-term owners to rent. They’re on a two-year contract, and we’re in a wobbly market,” Kaminsky says. “It’s probably smarter to rent than it is to buy.”
Some celebs don’t live in Los Angeles full time but might need to be in town for a few months at a time for movie shoots or other projects. Kaminsky shares that he has a rental on the beach for $40,000 per month that is common among high-caliber celebrities.
Plus, celebrities tend to get a bit more leeway with renting than other lessees might. Marguleas shares that an Oscar-winning celebrity once spent three extra days in her rental when the lease was already up. When they went to prepare the rental for the next tenant, they found her Oscar on the mantle.
Another tenant visited a Palisades rental property six different times before she decided to sign the lease.
“At one point she came with a bottle of wine and asked if she could just sit in the property for two hours with a bottle of wine to see if she wanted that property,” Marguleas comments. “So it’s just not very normal behavior in some cases, you know.”
Do celebrities buy in normal neighborhoods?
While many celebrities prefer the privacy of gated communities and even gated properties, there are some celebrities who choose to live in less upscale neighborhoods, or at least part-time. Sandra Bullock, for instance, lives in Austin, Texas, where people are generally protective of their celebrity neighbors.
“If you can get that kind of buy-in from the public, it certainly helps,” Harrison shares.
Kaminsky explains that many athletes have one home in the city where they play and another home in their hometown, which can often be fairly “normal,” by celebrity standards.
“You’ll find them in some small-town USA in a really cool house and also in the city they’re playing,” he explains.
Are celebrities hard to work with?
It depends on who you ask.
“It’s case by case. But I would say they’re generally much harder [to work with],” Kaminsky comments. “The higher you go up on the A-list, the more barriers there are.”
Instead of negotiating with another agent or speaking directly with the buyer, real estate agents find themselves being passed around several of the celeb’s handlers and agents. This can cause transactions to take longer than normal, even in a market where sales and rentals are flying off the shelves.
“Today, I was talking to [a celebrity’s] real estate agent, the real estate agent is talking to the travel manager for a film company, the film company is speaking to the business manager and the business manager is speaking to the actor,” Kaminsky explains. “So it’s four layers to get to the actual person who’s going to live in the home.”
Additionally, there’s always the challenge of working with higher-tier celebrities who have a hard time dealing with the competitive real estate market, and the possibility that they may not be able to get exactly what they want. However, those celebs are in the minority, the agents said.
“Some celebrities are amazing to work with, some are a little more entitled, as you can imagine. People are always at their beck and call 24/7, they’re used to getting everything they want,” Marguleas says.
We all want to be able to walk in at the end of the day, shut our door, and go, ‘Sigh, I’m home.’ Don’t think that just because they’ve got the stardom that they feel any differently. Home is home.
- MaryBeth Harrison
Real Estate Agent
Real Estate Agent at Dave Perry-Miller Real estate
Currently accepting new clients
- Years of Experience
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What do celebrities look for in homes?
The number one thing celebrities look for in a home is privacy. Constantly followed by paparazzi and fans, celebs need their house to be a place they can truly unwind without fear of being watched. In some parts of LA, tour buses specifically go by celebrities’ houses. This has made gated communities like Brentwood Country Estates much more popular, Marguleas says.
In addition to gated communities or even gated properties, celebrities might look for landscaping that doubles as camouflage so the home does not seem too obvious within the neighborhood. Screening in outdoor spaces like the backyard is also vital.
“We all want to be able to walk in at the end of the day, shut our door, and go, ‘Sigh, I’m home.’ Don’t think that just because they’ve got the stardom that they feel any differently,” Harrison explains. “Home is home.”
Aside from the security, every celebrity wants a home that sings to them and meets their needs, whether they want their own private oasis or a huge home to entertain in.
What else is different about celebrity real estate clients?
Selling homes for celebrity real estate clients also comes with its own tricky situations. If a listing or an agent reveals the owner of the house is a celebrity, they lose privacy for the rest of the time they’re planning on living in the house. However, this detail could also mean a higher sales price.
Ironically, revealing the same information might also lead to lower offers. If potential buyers know that the seller is wealthy, they may think they don’t need to offer a very high amount because they already have so much money. The same goes for revealing the identity of your buyer. Harrison has seen this herself when she works with top-ranking CEOs in Dallas.
“Once people get any kind of inkling of that, the negotiations are pretty much over. They think, ‘Well, they can afford that.’ So you’ve lost your negotiation when people realize who they are, whether your popularity is out there, whether you’re the head of a major corporation.”
Conclusion – home is home
All in all, celebrity buyers and sellers have a lot to keep in mind throughout their real estate transactions. That’s why even the top-tier talent of the world needs a real estate agent to guide them through the home buying or selling process — even in addition to all their own agents, handlers, and managers. But no matter who you are, your home is where life’s most important stories unfold.
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Header Image Source: (Ciudad Maderas/ Unsplash)