luxury market

Guess Which Buyers Have Joined the Luxury Homebuyer Ranks?

Jun 8, 2023

The media love to promote the idea that our millennial generation is so saddled by student debt that they require a bailout from the American taxpayer.

Guess what? That’s hogwash.

In reality, according to an Experian survey of student loan debt, Gen X and baby boomers, each hold more student loan debt than millennials.

According to a different Experian survey, fewer than half of millennials (42 percent) claim they have never been denied credit. Most surprising is that “… 66 percent of millennials have no student debt at all,” claims the Boston Globe’s Beth Akers.

More important, at least for real estate agents targeting millennial homebuyers, there are more than half a million millionaires in the millennial generation, and “… 93% of them have a net worth ranging from $1 to $2.49 million,” according to Mark Politi at LinkedIn.com, citing Coldwell Banker research.

Recent Engel & Völkers Trend Report surveys find that many have a higher net worth. Of the Americans looking to buy a home for more than $3 million dollars (so-called “peak luxury buyers”), nearly 60% are members of the millennial generation.

The number of younger millionaires will explode with the baby boomer inheritance wealth transfer over the next few decades. And according to the Coldwell Banker Global Luxury study, they will shop for high-end homes.

How can you position yourself to be the go-to agent for this cohort?

Carve out your space on social media

Yes, it takes time, but engaging with others on social media is critical to attracting these luxury homebuyers. Remember, the millennial generation was our first to grow up online.

However, not every social media platform is right for real estate agents. Keep your target market in mind in choosing where to market. For instance, millennials, born between 1977 to 1995, are, in 2023, between the ages of 28 and 46.

Older 40+ millennials are the wealthiest, with the top 1% net worth at nearly $8 million. The top 1% in the 35 to 39 age group is worth more than $4 million. The youngest group’s top 1 percent is about $600,000, according to Levi Rasmussen at WallStreetSurvivor.com.

These statistics should help when choosing which platform to use. Check its demographics to ensure it attracts your target audience.

“There is often a misconception among luxury brands and marketers that digital marketing is incompatible with the luxury industry,” according to Rumble Romagnoli with Relevance, a “… luxury digital marketing agency.”

People believe that UHNWIs [Ultra-High-Net-Worth Individuals] do not engage in social media, do not make online purchases, etc., or that if they do, it is only through super-exclusive social media sites or at private member’s clubs. This is absolutely not the case,” he concludes.

LinkedIn and Facebook are two of the best social media platforms an agent can use to target this audience. You might also consider Instagram ads, Romagnoli suggests.

Concentrate on emphasizing your expertise in both the luxury market and the local real estate market in general.

Erin Nicole Davis, citing an Engel & Volkers luxury homebuyer trend report, adds that “… real estate professionals who provide a personalized, high-touch experience when working with these buyers” will be the winners.

Bonus: You may just end up rolling in referrals!

PLUS: When you have time…below are some marketing tools to help support your success.

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The 3 Most Common Website Mistakes and How to Fix Them

Sep 9, 2020

Most agent website mistakes are easy to fix once you know how. Let’s take a look at the three most damaging agent website problems and their solutions.

1. Lack of focus

Many agent websites seem to reflect a common agent mindset: “I am a jack of all trades and master of none.” When agents are trying to reach every, last conceivable prospect, their websites end up with a vague and meaningless focus.

No, “Buyers” and “Sellers” aren’t target audiences – at least not in a way that sets you apart from every other agent in town. If you truly want these two, overly-broad groups as a target, create two websites, one for each.

Your buyer’s site can then be narrowed down even further. Are you looking to work with renters? Condo buyers? Move-up buyers? Retirement buyers? or Luxury homebuyers?

The same holds true for the seller-focused site: first-time sellers, downsizers, selling the luxury or waterfront home, for instance.

“One of the biggest marketing mistakes is to attempt to appeal to everyone at once.”

Suggests Tom Hallissey at Fat Guy Media. “The most-efficient way to reach more qualified consumers is to target smaller, more specific groups.”

We once worked with a woman who specialized in mobile home buyers. Sure, one mobile home here and there seems hardly worth the effort, but this lady specialized and marketed herself as the expert. She made a killing in the mobile home market and, her website was one of her best lead generation tools.

2. Overly-focused on the wrong things

Real estate prospecting is all about building relationships and each visitor to your site is a prospect. What happens then when visitors are immediately bombarded by how great you are, how many homes you’ve sold and how much money you make?

Is the braggadocio the person you would want to build a relationship with? Of course not. Self-important bragging is unattractive and doesn’t tell your website visitor one thing about “what is in it for them”.

So, skip the hype about you and, instead, make your website client-focused. If your ideal prospects visit your website, what do they want to know? How can you help them find it? Use your knowledge of and experience in real estate to demonstrate why you are the agent they should hire.

3. Wait … isn’t real estate all about location?

We recently read a Facebook post from an agent who was complaining that, after six months, his website just wasn’t “working.” He was blaming the website company.

Yet, one look at his site points the finger right back at the agent. The only mention of his market – his geographic location – was in his email address, posted at the bottom of the page.

He bought a template website and did nothing to customize it, except to plaster his own name all over it. This, despite there being numerous opportunities on the home page alone to stick in at least the name of his town.

His neighborhood pages consisted of his IDX for the area. That’s it.

According to NAR’s study, Real Estate in the Digital Age, nearly half of homebuyers using the internet are interested in neighborhood information.

Many agents ignore this section (if they even have one) of their websites, and it’s a pity. What’s it like living in a particular community? What are the good points? Why would I – as a first-time buyer, a move-up buyer, a commuter, retirement buyer, someone with a family or any other type of buyer want to live there?

Use your website to show pictures, discuss local news and events in your blog posts and anything else that captures why this neighborhood is a great place to live.

If your website isn’t converting as you hoped it would consider tweaking it to be more consumer-focused and offer the information they’re craving.

Send the Dream Neighborhood postcard from the Move-Up Market Series to a Move-Up Market prospect list.

Need help targeting a specific niche of buyers or sellers? Use our Demographic Search Tool to create the ideal list (it’s easy). Or call our support team for assistance at 866.405.3638!

PLUS: When you have time…here are some helpful resources we’ve made available to support your success.

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Understanding the Needs of the Affluent Homebuyer

Jul 22, 2019

Last year at this time, the news was full of the gloom and doom the president’s new tax plan was going to drop on the real estate market – especially the high-end second-home market.

Some experts predicted that owners who can’t find a tax loophole may end up selling, thus adding to the luxury home inventory.

Selling any home requires an understanding of the buyer pool. When the home is high-end, it’s even more important, as this pool is significantly smaller and those swimming in it are much more specific in their wants and needs.

While the list changes frequently, a few features that attract affluent homebuyers remain the same decade after decade. These include privacy and security, a personalized or custom space and a home that helps build “happy memories with family and friends,” according to a 2018 Luxury Portfolio International® study.

Putting these qualities into words and highlighting them is critical when marketing a luxury property.

What else are today’s wealthy homebuyers seeking? Read on to learn more.

What are the affluent homebuyer’s hot buttons?

It’s challenging to lump together any group of individuals and assume they all want the same things. The luxury homebuying pool is no exception. International buyers, for instance, have vastly different desires than the luxury buyer planning to live in the home full-time.

Then, the more expensive the home, the longer the list of must-haves.

Available in the postcard section under the Luxury Series.

But, when studying domestic luxury homebuyers, certain themes become apparent. These include their desire for privacy, energy efficiency and a spa-like master suite, among others.

Privacy

Privacy tops the list of concerns of affluent homebuyers, according to the Luxury Portfolio International study of the top 10 percent (by income) of real estate consumers.

This is particularly evident in land-starved areas, such as Silicon Valley, where Mark Zuckerberg bought four of his neighbor’s homes to provide a buffer between his family and the rest of us. He also walled off his neighbor’s ocean views near his Hawaii home, trying to create even more privacy.

Wealthy homebuyers want tech-friendly homes

When we think “tech-friendly” we typically picture a millennial homebuyer. Recent surveys show, however that 87 percent of buyers shopping in the luxury market won’t purchase a home that doesn’t offer tech features.

App-driven security systems are the most in-demand feature (with more than half of high-end property buyers requesting them), followed by automated climate control.

If your luxury listing’s tech system also extends to controlling other home systems, you’ll want to hit the feature hard in your marketing materials.

Scaled back swimming pool

A Redfin study finds that luxury buyers, for the most part, still insist on a swimming pool, but they want it to be smaller. This makes sense when we understand their desire for more backyard entertainment features. A smaller pool leaves more room for these additional features.

What the affluent seek in a real estate agent

According to a 2017 Luxury Portfolio International white paper, there are three qualities that the high-end home shopper or seller is seeking in an agent.

The first is trustworthiness. Let your testimonials do the heavy lifting on this one. Ensure that you place your best one above the fold on your website and that the others are easily accessible.

The second quality you’ll need to attract affluent real estate consumers is proof that you understand the “details that distinguish the best.” This means understanding “artistic craftsmanship.”

Yes, it’s something that can be learned, but it takes time. Immerse yourself in architecture and art. Tour high-end homes to get a feel for what constitutes “aesthetic quality.” Get to know the luxury brands that this pool of homebuyers finds valuable.

Finally, when asked about their ideal real estate agent, luxury homebuyers say they want to work with someone who is willing to “take the time to understand my needs.”

Now that one is universal.

A great resource for agents interested in entering the luxury market is Michael LaFido’s Luxury Blueprint Video Series. It’s a three-part series on how to break into and sell more high-end and luxury homes.

You can also listen to his podcast “Luxury Listing Specialist” on iTunes or Stitcher. For information on Michael’s Luxury Listing Specialist Certification Click Here.

Luxury Property Flyers (available under the Luxury Marketing tab on our website)

If you have a luxury property listing be sure to order Luxury Property Flyers to enhance your client’s property and highlight its outstanding features.

Need help targeting the perfect niche of buyers or sellers? Use our mailing list too l to create the ideal list (it’s easy) or call our support team for assistance at 866.405.3638!

PLUS: When you have time…here are Free killer tools to help your success this year!

1. Become a Listing Legend Free eBook

2. “Get More Listings” Free Online Webinar

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3. The 12 Month Done-For-You Strategic Marketing Plan

4. The Free One-Page Real Estate Business Plan

5. The Free Online ROI Calculator