A new generation of homebuyers is entering the market, and with them a new way of interacting. In a few short years, older millennials will reach their peak earning years, and they are changing the landscape of luxury consumerism. Understanding the young affluent buyer can present many challenges, but if you can identify certain characteristics of your customer base, you should be able to easily navigate the changing world of luxury real estate. Here is our 3-step, definitive guide to working with young affluent buyers.
Learn Who Your Client Is
While your customer base is not yet entirely millennial, the younger generation does make up a higher percentage of the luxury real estate market day by day. Luxury Portfolio has released a white paper with a decade’s worth of research on trends in luxury living. The research concluded, among other findings, that millennials see home ownership as a rite of passage that gives them a sense of establishment. Appealing to the sense of establishment affluent buyers find in a home will help you connect more easily with young luxury home buyers.
Luxury real estate professionals should approach connections with the mindset that they have already done their research. Young affluent buyers more than likely already know what the internet has to offer, so rather than listing facts, a real estate professional in the luxury sector should present buyers with the possibilities the home presents.
With the challenges presented by this new client base, how does one target an audience so different from its predecessor? A luxury real estate professional needs to study the lifestyle of the young affluent client.
Study the Lifestyle of Your Affluent Client
Every luxury consumer is different; they all bring different talents and passions to the table. The only way to know how you can appeal to the luxury client you are working with is to listen. Early on, learn about your target luxury consumer’s passions and lifestyle wishes so that you can know when and where to find them a home that fits their unique dream. Listen to the lifestyle they want to lead, understanding that they may not be leading their ideal lifestyle at this moment.
Ask them some questions before moving forward in finding a home for them:
- What do they love about their current home? Why are they leaving it? These questions can rule out or draw in possibilities you may not have otherwise thought of.
- How can you help them achieve the lifestyle they want to lead? When they find a home that fits their unique vision, remind them that there isn’t a price point on lifestyle and their dream home could sell quickly.
In the market of young affluent buyers, those looking for homes are not looking for the mansions baby boomers desired. Larger homes are seen as more unnecessary work, and affluent millennials do not want a home that impedes on their lifestyle. The millennial buyer wants to know that their freedom is not compromised, so you need to work to create value in a home if you are going to sell to a young affluent buyer. Find out what, in a home, adds to their lifestyle and sell them on it.
Market the Luxury Experience
Young affluent buyers still see luxury as relevant and worth their financial and time investment, but it is less related to the status that comes with a luxury purchase, and more about the experience. Millennials pay a premium for luxury items and homes if they can envision the long-term reward of their luxury purchase. What does this mean for a luxury real estate professional reaching the young affluent buyer? Consider some common themes in the millennial market, and how they can affect your marketing approach:
- Young affluent buyers spend much of their time on their phones. Is there a way you can create meaningful connections through a mobile online platform? Social media is one of the most important marketing platforms for young affluent buyers. In a survey performed by Havas LuxHub, nearly half of affluent millennial buyers said they discover luxury brands via social media.
- Millennials prefer modern luxury. They look for a mix of timelessness and contemporary relevance, and seek out marketing content that is fresh and innovative. The young affluent buyer responds well to style guides and trend reports. For a luxury real estate professional, this means leveraging an awareness of brands young luxury consumers will respond well to. Consider creating guides of homewares and furniture that will elevate the experience a homebuyer has in a home you are selling.
- Young affluent buyers seek out independent brands. A common theme for the entire millennial generation is the importance of cottage industry. Affluent buyers largely perpetuate this trend, as they are the most able to afford it. A luxury real estate professional can weave this trend into its marketing approach by showcasing independent brands in style guides and trend reports. Websites like CoffeeKlatch and Of A Kind feature independent luxury brands that young affluent buyers are seeking out, and are an excellent way to find the types of items luxury consumers want to buy.
Key Takeaways: The Biggest Differences in the Young Affluent Buyer
- They value experience over anything else, and are not as concerned with the brand name as their preceding generation.
- They largely prefer modern, pared down aesthetics.
- They are more likely to find luxury brands and real estate professionals on social media.
- They want to support small business, and want to work with real estate professionals who share that value.
With a growing number of young affluent buyers entering the luxury real estate market, it is important for luxury real estate professionals to keep up with trends that keep millennial buyers interested. The training team at The Institute is knowledgeable and able to help you learn more about what it looks like to stay on top in an ever-changing luxury real estate market. The Institute offers both live and online trainings, packed with information to help you relate to and work with affluent buyers.