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Luxury real estate has many identifying characteristics, contingent on geographic regions of the world. Location is one of the definitive characteristics of luxury real estate. Inclusion in this category can stem from views (particularly waterfront views), or amenities such as golf, school districts, downtown proximity and conveniences. A 750 square-foot waterfront home with less than one acre of property, two bedrooms, and one bath, might be worth more than a 10,000 square-foot mansion with ten acres of property.
In the above example, the term that would better suffice would be "luxury property" as opposed to "luxury home," whereas the 10,000 square-foot mansion would fit under the definition and category of luxury home or estate. Both properties, however, should be classified as luxury real estate."
General rules of classification must take into account a broad average price range in a particular region and define a lowest limit (e.g., "all homes priced above $1 million" is a common definition in the United States). Other factors involved in classifying properties into the luxury category are surrounding homes, amenities, views, waterfronts, absence of crime in the area, absence of industrialization or unwanted commercialization, customizations of the home, and historical or architectural significance.