With record-low mortgage rates and a surge of relocations spurred by the ability to work remote, buyers are on the move. Among many of these movers and shakers are “young affluents” — a powerful cohort of incoming luxury homebuyers.
This demographic of millennials and Gen Zers may make up a small percentage of the buyer pool today, but the number is growing. A great wealth transfer is happening and experts predict more than $15 trillion will be passed down from the world’s richest individuals to the next generation by 2030 globally.
Marketing to young, affluent buyers is a different ballgame. Agents need to think differently about how they do it and prepare for the shift in wealth.
As a millennial real estate agent myself, here’s what I have learned while climbing the professional ranks and serving my peers.
Create a luxury experience for buyers across all price points
A younger buyer might engage with you multiple times as their wealth increases or their life situation changes. You want the experience to be consistent and memorable. Although their first transaction might not be a high dollar sale, providing a high level of service regardless of budget is paramount to receiving repeat business.
Research has shown young buyers are all about experiences, and the way they shop for real estate is no different. Everyone wants a story to tell. Can you make the real estate process easier, faster or more fun?
Build your sphere of excellence
Young clients might not be executives or at the top of their fields just yet, but they are often on that track. These individuals operate at a high caliber and demand that same level of excellence from not only their real estate agents, but also everyone involved in the transaction.
Look around at your own network and associations. Have you properly vetted your sphere of attorneys, lenders and other experts? If you are regularly making recommendations to these contacts, be aware they are a reflection on you. The goal is to connect your clients with complimentary service providers who also share in your commitment to excellence.
Focus on lifestyle
The promotion of lifestyles versus products is nothing new (just take a look at brands like Nike and BMW that have mastered the art of lifestyle marketing). However, applying this concept to the world of real estate is a relatively new twist.
Gone are the days of selling a home purely because it checks off the boxes. You want to go deeper.
What inspires your buyers? This is particularly important for young clients who have so much ahead of them. How can a certain home help them to achieve their aspirations? How will it improve their lives? Help them to envision it.
Having this perspective might also influence the way you show a property and sell the lifestyle. Try to connect with prospective buyers to understand what aspects of the home will resonate with them personally.
Creating value for your clients
I have found my high-achieving clients in their 20s and 30s to be incredibly driven and resourceful. As a real estate agent, how can you position these clients for success? How can you add value during the transaction and beyond?
My advice is to become a trusted resource for your clients and the hub for all of their real estate needs.
For example, can you provide your clients market data to keep them updated on their real estate holdings? How about offering consultations regarding home improvement projects and potential resale? Can you assist in referring clients to other quality agents if they want to pursue a second home or investment property outside or your territory?
These are all viewed as value adds and above and beyond the typical scope of services.
Understand your ‘feeder markets’
Whether you’re promoting a new listing or promoting your own services, it’s important to target the right prospects. The key here is to understand how you can make connections in “like-markets” that bring buyers and clients to your local area.
These “like-markets” typically offer similar lifestyles making it a natural transition for young buyers on the move. For example, Boston waterfront neighborhoods are often feeder markets to the city’s coastal suburbs. I regularly tap certain areas in Boston that are located on the water when marketing an oceanfront home north of the city.
Learn to navigate a multilevel sale
A key observation that I have made when working with younger buyers, and particularly younger buyers in the luxury space is there’s a strong possibility other people will be involved in the decision-making process.
Parents frequently play a role in the sale — be it financially or for a “stamp of approval” before a purchase can be made. Other players like trustees, attorneys or financial advisers can also show up in the mix.
To be successful when serving young affluents, you’ll need to learn how to navigate a multilevel sale. My recommendation is to always ask your clients if they will be seeking input from anyone else during the homebuying journey.
Building trust amongst all of the decision makers is paramount and I’ve learned that bringing everyone together early on creates a smoother process.