Trends in the Luxury Home Market

The Luxury Home Council recently released the The 2007 Membership Survey of Luxury Housing Market Trends*

Luxury Dining Room TableWhile the survey is excellent and the information useful I thought I might uncover a few secrets here that might change the way I recommend marketing to high end clients, but there were really no surprises.

If you only read the following stats then you will benefit from having the secret of real estate success reinforced; spend your time and money marketing to your sphere of influence:

  • 75% 0f Realtors come into contact with a luxury home buyer for the first time through a Referral or recommendation
  • 55% of business luxury home business comes from personal referrals
  • 70% of luxury home buyers select their Realtor for their integrity and honesty
  • 67% of luxury home buyers select their Realtor for their knowledge of the market

Following are selected results from the survey:

Who is buying luxury homes?
40-50 age group (48%)
50-65 age group (44%).
These are the “Baby Boomers” that have reached their peak earning years and are now benefiting from a rising stock market and historically high home prices.

What do they do for a living?
Entrepreneur 51%
Large Business Executive 46%
Medical Doctor 24%
Retired 24%

Luxury Stucco HouseWhen the Realtors were asked to select what services luxury home buyers are most interested in receiving from you (you may choose more than one):

Help in finding a home 86%
Help managing the transaction 56%
Expert counsel during negotiation 43%
Advice on purchasing a luxury home 34%
Assistance with paperwork 28%
Help understanding the process 13%
Help locating jumbo financing 9%
(This does not seem any different than regular folks.)

How long will they typically spend looking?
11 Weeks

How many homes will they look at?
12

Luxury Nice big house treesWhat are the most popular luxury home amenities?
Gourmet Kitchens 95%
Master Bedroom Suites 86%
High-End Appliance Package 64%
Home Office Suites 58%
Home Theater Rooms 55%
Custom Bathroom Suites 47%
Electronic automation 34%
Home Gym Rooms 25%
Personal Sanctuary Rooms 9%
Green Building Construction 7%

What services do Luxury Home Sellers look for?
Marketing & Promotion services 86%
Help with pricing the home 77%
Help with negotiating a sale 62%
Help managing the transaction 57%
Help with staging the home 49%
Help understanding the process 31%
(This does not seem any different than regular folks.)

What do you consider to be your most effective marketing techniques when you promote your luxury home listings: (you may select more than one):
MLS 66%
Social Networking 61%
Color Brochures 44%
Company Website 43%
Personal Website 42%
Specialty Magazines 38%
Email Marketing 28%
Open Houses 27%
Custom Listing Website 21%
Real Estate Guides 18%
Newspapers 16%
Television/Radio 6%

Do you offer virtual tours on your luxury home listings?
Yes 81%
No 19%

Do you hire a professional photographer to take photos of your luxury listings?
Yes 57%
No 43%

Do you ever use a rendering, drawing or architectural elevation to market your listings?

Yes 47%
No 53%

How do you typically come into contact with a luxury home buyer for the first time:

Referral or recommendation 75%
Advertising luxury home listings 19%
Personal marketing 18%
Clubs and affiliations 14%
Prospecting 12%
Website 11%
Mailings 4%

Do you have a personal website?

Yes 77%
No 23%

Do you use a personal brochure?
Yes, I have a professionally printed personal brochure 37%
Yes, I print my own personal brochures 27%
No, I do not use a personal brochure 31%

In your experience, why do you believe that a luxury home client will choose you over another agent?

Integrity and Honesty 70%
Knowledge of the market 67%
Recommendations and Testimonials 60%
Marketing and promotion skills 44%
Experience in the market 44%
Success ratio in the luxury market 18%

How much money do you invest in personal marketing each month?
$1,085

What percentage of your business comes from personal referrals?
55%


*The survey was sent to 1036 members of the Luxury Home Council, an exclusive group of REALTORS® who specialize in selling Luxury Housing, 202 members provided useable answers to the survey questions. On many of the questions related to marketing participants were allowed to provide multiple answers resulting in percentages adding up to more than 100%. In comparing statistical data both the terms average and median are used. An average is defined as the total result divided by the number of answers provided, while a median, also known as the 50th percentile, represents the half way point f all answers, 50% are higher and 50% are lower than the median.

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