Is investing in a celebrity's property worth it?
Own Muhammad Ali’s Michigan farmhouse; check out Madonna's Sunset Boulevard home; peek inside Shaquille O’Neal’s Superman-inspired pad; buy Elizabeth Taylor’s Beverly Hills house; invest in Prince’s Caribbean estate.
These are just some of the hundreds of headlines that dominate real estate news. They proudly announce the availability of that most fascinating of investment opportunities: a celebrity-owned home.
Whether you’re a Hollywood buff (Sandra Bullock’s Sunset Strip residence, anyone?), political animal (think Jackie Kennedy’s childhood home), sporting enthusiast (Michael Jordan’s Chicagoland mansion) or devoted to legendary musicians (Elvis Presley’s Bel Air bachelor pad), there’s something for everyone in this niche segment of the property market.
Our obsession with the houses occupied by a favourite famous (or infamous) personality is well-documented. Just look to the number of tourist attractions and television shows dedicated to the topic, or to the column inches, images and videos put up about these properties in even the most prestigious of publications, not to mention innumerable independent blogs and vlogs.
“After talking to people from different stations in life to see what the draw is, I found that celebrity homes appeal to those who are wealthy because they like to compare theirs to see if they’ve done better in the pecking order of showmanship,” notes Genelle Brown, content manager at TopTenRealEstateDeals.com, a directory of some of the most high-profile properties on the market from around the world. “The not-so-wealthy, meanwhile, like to dream about how wonderful it would be for them to live that way, and often believe that these homes and this life must have been handed to celebrities on a silver platter.”
Famous faces and other perks
“The number-one appeal of such a home is the tremendous PR that a celebrity will give to a property if they’ve lived there or currently own it,” adds Ivena Armand from Joyce Rey, a Beverly Hills real estate firm. “Additionally, buyers who have an interest in the film business will often look for a star connection on a property. And while it is difficult to measure the exact value of such a home, it is a definite asset in today’s world that celebrates celebrity above all else.”
From naming a child after their favourite actor’s pet pooch to dyeing their hair to match the exact shade of their beloved pop star, fans have been known to go to obsessive lengths if they think it’ll bring them closer to their celebrity crush. So to be able to live under the roof that was once occupied by a cherished star is a dream come true for many.
This is why most realtors or sellers who came to own the property right after a celebrity moved out, choose to retain the “original features” that the house came with when the star in question was staying in it. One of the reasons why O’Neal’s Florida mansion can claim a slam-dunk Dh103 million is because it is equipped with a 6,000-square-foot basketball court, with framed jerseys on the wall, which the NBA star himself practised in. The same goes for Prince’s Turks & Caicos home with has a purple driveway; it’s unlikely that any interior decorator would recommend that vitriolic shade of violet, but it is what’s most likely to seal the deal for the Purple Rain singer’s property- seeking fans.
Brown offers a word of caution. “I have come across some rather tasteless houses, formerly owned by older or dead celebrities, which were never updated. Liberace’s house in Las Vegas was horrid, and one of Jennifer Lopez’s California houses had a very cluttered [bathroom]. No matter how big of a fan you are, refrain from buying a worn-out, cluttered 1960s decor with shag rugs hiding unknown creatures,” she says with a laugh.
Another appeal that these homes hold is that they once hosted other famous people that the celebrity owner may have counted as friends. A Bel Air home, which is currently listed for US$23.4m (Dh86.1m), not only counts Presley and Moulin Rouge actress Zsa Zsa Gabor as former owners, but also comes with the claim that The King once hosted a party there for The Beatles. The sprawling estate was also the location for films such as Behind the Candelabra, starring Michael Douglas and Matt Damon, and Ben Affleck’s Argo. Other famed house guests include Queen Elizabeth, Ronald Reagan, Frank Sinatra and Elizabeth Taylor. The latter’s own Beverly Hills house – which she stayed in when married to her second of eight husbands – is on the market for $16m.
Morbid curiosity is a third reason why some investors seek out celebrity homes. From the Holmby Hills mansion that Michael Jackson died in, to the Spanish-style residence in Los Angeles in which Marilyn Monroe killed herself, some properties are picked up for their conversation-starting shock value and perceived resale rate.
Resale value and other downsides
Of course, the homes may not always be worth a high price. The story goes that, years before he bought his Santa Monica beach house – that’s now on the market for $12m – Cary Grant wanted to rent a home in Malibu. The North by Northwest actor convinced the landlord to charge him a reduced rent, with the assurance that once people knew Grant had lived there, the landlord could easily double the rent. As the unfortunate man found out after Grant moved out, that was not the case, after all.
To be fair, there are just as many stories about celebrities or their agents having to cut back on the original asking price, when the house in question has not sold for years on end. Case in point: pop singer Usher sold his Alpharetta mansion last month – complete with a climate-controlled treehouse – for $1.5m, down from the original $2.48m he was hoping for. Alternately, celebrities may undersell when they are strapped for cash or have to pay their considerable legal bills.
Like any other investment, thorough research is a must when house-hunting. “When it comes to buying any structure, especially in California where earthquakes are prevalent, the first thing to do is to have it surveyed by a structural engineer. Since celebrities are rarely in-residence, the mechanical systems may not be used on a routine basis and start to deteriorate. Therefore, all electrical and plumbing should be carefully evaluated,” cautions Brown. “If the structure is located near the ocean, any hairline cracks in the exterior invite salt into the walls. These contain steel rebar, which will corrode, rust and eventually burst through the concrete. In that sense, celebrity homes are no different from any other homes and must be inspected prior to purchasing.”
When it comes to resale value, Brown says there is no real evidence to suggest that a star-owned property is necessarily worth more. What this also means is that you should not be paying too much over the market value of a house in a certain area just because Madonna burnt her toast in the kitchen. Unless, of course, the idea of cooking in said kitchen appeals to you so much that you’d do anything to possess it, money no object. And therein lies the trapping of a celebrity home: to a true fan – especially one with ample financial backing – this is a priceless property.