Luxury Portfolio Vol. 08 Issue 01 - Clark Realty

LUXURY LOYALISTS The Luxury Loyalists are high-net-worth consumers over

In which one type of location do you want your next personal residence?

50 years old who are in the market to buy a personal residence for $1 million or more within the next 3 years. These are the traditional luxury home buyers who have historically made up the bulk of luxury consumption in the world. These buyers are now at a stage where their priorities are shifting from raising a family to preparing for the next chapter in life. Transferring Assets to the Next Generation Luxury Loyalists want to see the money that they pass down to the next generation to be a source of joy for their heirs. This means heirs have a chance to live with a portion of their inheritance while the earner is still alive. These benefactors have the opportunity to teach and guide their heirs before much of the estate is passed on. More Millennials expect to inherit, compared to Gen X and the Baby Boomers, and they stand to inherit more money overall than the previous generation. What Does It Mean for Real Estate? Luxury Loyalists are thinking long term. They want to ensure their family is well protected financially and focus on adding quality to their lives for the years to come. Families have crafted a moat (primarily of cash) that protects their castles and their peace of mind. These buyers are seeking to simplify their lives, as they no longer have a need for large homes for multiple family members. Smaller homes with sustainable features are favored over large spaces that require regular maintenance. Trends Luxury Loyalists who plan to spend at least $1 million on real estate in the next one to three years, tend to be in the market for a home in the suburbs under 5,000 square feet, with fewer bedrooms and bathrooms.

28% 60% 13%

Urban

Suburban

Rural

These buyers are seeking contemporary and modern homes as way to simplify their lives with less square footage and sustainable features. Mediterranean homes are also in demand as the allure of southern European design remains strong with the generation who grew up romanticizing the region through movies, food and travel. One-fifth of Luxury Loyalists are also considering moving to more compact spaces due to the efficiency, security and ample amenities offered by a large building of condominiums or apartments. Top 5 “Essential” Next Home Features

1

Has Outdoor Space, such as a Patio or Terrace

3 2 4 5

Construction Incorporates High-Efficiency Windows and Doors Has a Dedicated Laundry Room with High Efficiency Appliances (or space for their own)

Master Suite with Dual Closets

A Butler’s Pantry with Ample Storage

MILLION-DOLLAR HOME BUYERS IN TOTAL

41.8

Average Age

Excerpted from The Rise of the New Aristocracy. Download the complete 16-page report with an expanded list of the desired amenities of the future affluent buyer at luxuryportfolio.com/whitepaper.

$431K

Average Income

$5M

Average Investable Assets

38%

Affluent or Wealthy as a Teen

56%

Inherit $1 Million or More

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