September 23, 2013
A new survey by Coldwell Banker Previews International and the Luxury Institute finds that wealthy younger buyers are driving the luxury real estate market, and they are willing to pay more than similar wealthy buyers age 55 and older.
The survey looked at Americans age 21 or older with a minimum gross annual household income of $250,000. It found that 43 percent of younger wealthy consumers are considering purchasing residential property in the next 12 months, compared to 21 percent of those age 55 and older. These younger, wealthy buyers spent an average of $2.1 million on their most recent purchase of residential property, approximately twice the average amount spent by older and similarly wealthy buyers.
“Luxury homes are for more than successful and retired empty nesters,” says Milton Pedraza, CEO of the Luxury Institute. “Today’s luxury buyer is both dynamic and diverse, and it’s reflected in the homes and products they’re buying.”
So what are these younger buyers looking for? The survey found they are significantly more likely than wealthy buyers age 55 and older to want homes with amenities such as a pool, outdoor kitchen, home gym, home theater, wine cellar, and four or more garages. They are also more than twice as likely to value green or LEED-certified properties.
“This trend toward younger luxury buyers is leading a change in desired home amenities,” says Betty Graham, president of Coldwell Banker Previews International NRT. “Whether these younger buyers have young families or are single without children, they are looking for homes that fit their active and unique lifestyle.”
For most luxury buyers, location is the most important factor when considering the purchase of residential property. And though they may travel internationally, only 6 percent of wealthy homeowners surveyed own residential property located outside the U.S.