Features and tRends

(May 23, 2008)

Luxury is Technology and Experience for Affluent Consumers

By Lyndsey Forster and Shannon Benton

Custom homebuyers are well informed and typically self-educated on the various home product trends and advanced housing system options available to them. These consumers desire top quality, award-winning products and services that help them to achieve their personal aspirations. Architects, builders and home product manufacturers alike need to appeal and respond to these affluent mandates by offering added-value options that attract this fruitful market. It is critical to continually assess product offerings based on the appeal of not just design, but also technology.

“New types of residential spaces including those outside of the home are very much in vogue in today’s custom homes,” comments Vicki Edwards, CKD, ASID. Similarly, bathrooms that serve as personal sanctuaries including luxurious fixtures and incorporating the latest in environmentally-friendly, water conserving features, will be continuing to drive luxury homeowners’ purchasing decisions.

Top Markets Serving Affluent Homebuyers
Lavish real estate properties are breaking price records even in today’s seemingly bleak economic state. In a recent study conducted by the U.S. Bureau of Economic Analysis (BEA), the nation’s personal income levels have been classified into five tiers in order to paint a clear picture of the distribution of wealth across America. The highest-level homebuyers remain concentrated in California and the Northeast with cameos in select markets such as Texas and Florida. These states, as classified by the BEA, account for over a quarter of the total income of the U.S.

Appealing to Luxury Consumers
Slightly impervious to today’s housing slump, the majority of luxury buyers are not typically motivated by bargain prices. According to Business Week’s Prashant Gopal, wealthy purchasers tend to be unmoved by lower interest rates as they have the ability to pay cash for a home or put a large percentage down at closing. Instead, she explained that luxury consumers look for trophy homes that cater to their individual demands for the latest in comfort, style, convenience, performance and that appeal to their overall lifestyle needs.

In addition to wanting all of the individual comforts and technology systems available, most aspire to own a home that contains quality products along with moral benefits. This is part of the boost behind carbon offsets and residential use of green textiles, flooring and countertops. Notwithstanding, it is surprising to know that today’s average homeowner spends approximately $1,900 per year on energy according to ENERGY STAR. Highly rated, energy-efficient appliances are a must in this group—not necessarily due to the actual cost savings—but instead, to have anything otherwise would be considered oh so, “behind the times.” To that end, news stations across America are featuring broadcasters discussing how today’s hottest celebrities and top political candidates are using and endorsing the use of eco-friendly, sustainable products and materials.

In today’s designer-created kitchens and bathrooms, providing custom appliance upgrades such as efficient induction cooktops and water-conserving plumbing fixtures, have become the norm. High-performance products and technology systems are now and will remain a pivotal selling point with this group. As referenced by New York’s Real Estate Weekly author, Andrew Gerringer, most custom bathrooms now include additional square-footage for a steambath as well as the floor-space for an oversized garden tub.

Increase Your Bottom Line
When attracting today’s affluent consumers, remember to appeal to this group’s evolving desires and demands that will allow them to maintain their complex lifestyles. This can be accomplished through targeted marketing and sales strategies geared toward major geographic areas where they reside, in addition to incorporating home design and product attributes that entice these individuals to buy. It is important to reiterate that luxury consumers do not just consider price and yesterday’s brand names when making today’s purchasing decisions today. Instead, design and product attributes that enhance luxury consumers’ lifestyles while showcasing the latest in technology, comfort, style, performance and eco-friendly options are what’s really in the hearts and minds of these big-ticket spenders.

Want more information on how to market to the luxury consumer? Click here.

 


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