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In today’s real estate practice, the new affluent are well-to-do millennial buyers and sellers who have either purchased property, or who are actively engaged in the process of purchasing it. And they are doing so astutely.
Years ago, report after report criticized millennials and called into question their motivation and ambition. Yet, this generation’s experiences with the Great Recession in the late 2000s made them more determined to multiply their wealth. So what are the main characteristics of the new affluents, and what separates them from the traditional affluent client?
Conservators versus innovators
In the luxury coastal market, we’ve watched how the profile of the traditional affluent client has evolved. Originally, buyers were deeply familiar with Florida’s Gulf Coast and sought to secure a second home as a space for entertaining and eventually, as a legacy for their families. Today’s traditional affluent client still holds these values but exhibits a strong inclination toward the preservation and protection of their assets.
The new affluent community, by contrast, views its purchasing power with more fluidity. These clients aren’t as attached to one property or another and look to roll their equity into a higher-valued home with greater speed than the traditional buyer.
Home is where the investment is
Buyers under the age of 40 are similar in their focus on elevating their families’ standard of living. What sets new affluents apart from the larger cohort of millennial buyers is their purchasing power and willingness to execute on a deal.
Years ago, we were introduced to a client who is the very definition of the new affluent — informed, industrious, and intentional. It took three years to get to closing but was worth the time it took to get there.
As a generation, millennials can be cautious in their real estate endeavors — a natural response, given the global economic turbulence they’ve experienced throughout their young adulthood. This caution does, at times, extend to high-net-worth individuals.
What about the Gen Z affluents?
Millennials have been joined by another generation who are beginning to amass wealth of their own: Gen Z, who we might call “the emerging affluent.” Investors from this generation have often inherited their fortunes or achieved some form of celebrity. So far, they seem to behave more like traditional affluent buyers, but share certain views and values with millennial affluents.
Social responsibility is highly important to these buyers. We’re not surprised to see that our New Urbanism-influenced communities appeal to young people across generations. The conservation, green building, and pedestrian-focused efforts of these towns emulate their ideals.
We also see consistency between new and emerging affluent clients in the fact that both believe money is a means to achieving an end, not the end itself. Even more so than social responsibility, this is what sets younger buyers apart from the generations that preceded them. They have a greater focus on what they can accomplish, rather than simply what they possess.
3 tips for assisting the new affluent
1. Understand where their priorities lie
Learn the language of your clients. Craft questions to gain insight into what they need and, as agents, what you need to know. It can be as simple as asking about their preferred style of communication: does this client prefer phone calls or texts? Is location more important than ROI? What are their goals with this property over time? What is important to your new affluent client will likely be completely different from your traditional affluent client, and you must be prepared to serve both.
2. Know what they’re passionate about
Beyond learning about your clients’ goals, find out what excites them. By getting to know them, your interactions will be authentic and your interest will be appreciated.
Once you have that rapport, don’t lose it. Keep them interested in their investments — or potential investments — by sending updates on a regular basis. Is there a new development that could impact the value of their property? A new restaurant opening in the area? Sharing points that are valuable to them will inevitably show your value as well.
3. Be prepared to make an impression
Luxury real estate practices grow fastest through referrals. Keep in mind that if you’re selling a luxury property, chances are you’re not the first agent your client has worked with. Someone familiar with the process, with multiple transactions behind them, demands excellence. New affluents don’t need the hand-holding a less-experienced young buyer requires. Ultimately, they want a relatable, collaborative, friendly agent who they can trust as they make some of the biggest investments of their lives.
Julie Kerwin Cumby is a real estate professional specializing in properties along Florida’s Emerald Coast from Destin to Panama City Beach. With an extensive background in marketing communications and brand strategy, Julie lived and worked internationally before coming home to 30A and entering real estate. One of Rosemary Beach’s earliest residents, Rob Weil moved permanently to 30A in late 2011. He has witnessed the incredible growth and development of this dynamic area firsthand, and is extremely excited about the region’s further potential. Julie + Rob prioritize their clients and their goals, whether that takes the form of securing off-market opportunities, identifying opportunities for investments or simply providing the white-glove service that their clients have come to expect.