Luxury is usually a different play than your traditional cash flow game. It is not uncommon to lose money trying to hold it on a month-to-month basis like Daniel mentioned or get very low returns if you are buying it cash. But... there are investors that work in this space for other benefits such as appreciation, tax write offs (especially if it is a high income earner, this can be a way to offset your tax liabilities), etc. So while you may lose money if you are just looking at the rent, the overall returns over a certain period of time might be appealing enough to make it worth doing to some investors. Probably not a great BRRRR type product but it doesn't mean you can't make money in the space.
Like any other investment, you'll want to look at the total package to figure out if it makes sense, ie, can you do better here than investing somewhere else, especially since the higher price points and finishes required in your rehabs will mean it is more capital intensive than a lower end deal. If you have the cash, you can also flip in this space. You'll often have less competition since it takes more money and often more time to get these bigger/more expensive properties turned over.
Best of luck.
