Original research from global real estate brand finds that Millennial HENRYs are creating their own definition of luxury and increasingly turning to online influencers when considering a purchase
Engel & Völkers released the results of an original study.
“Meet HENRY: Influencing The Next Generation of Wealth”. HENRY, an acronym that stands for High Earners Not Rich Yet, represents a niche demographic subset of Millennials and the youngest members of Gen X who have an annual household income of more than $100,000 and the greatest earning potential.
For this study, Engel & Völkers surveyed more than 1,000 Millennial HENRYs (born between 1982 and 1999) about their definitions of luxury, the key factors that influence their purchasing decisions, and how brands, specifically real estate professionals, can reach them as the gatekeepers of tomorrow’s wealth.
Key findings of the report
- In defining the characteristics that make a brand luxury, 80% of respondents cite superior quality and 64% cite excellent reputation/word of mouth, while only 47% cite premium price
- When it comes to real estate specifically, only 38% of HENRYs consider sales price to be an indicator of a luxury home or property
- The top three indicators of a luxury home or property as identified by HENRYs are finishes (68%); neighborhood/location (64%); and amenities (57%)
Social media influencers are extremely important in reaching HENRY buyers.
- 67% of respondents follow influencers on social media; 58% follow influencers to learn about new products and ideas
- Topic experts are the most followed category of influencers among HENRYs (65%), surpassing even celebrities
- 84% of HENRYs say that influencers have impacted their decision to make a purchase, and 80% would consider hiring an influencer for their specific expertise, e.g. a fitness instructor, real estate agent, or interior designer
- Overall, 98% of HENRYs rely on social media or a review-based website when choosing a service provider
- When choosing a real estate agent specifically, the three most important factors cited by HENRYs are referrals from friends and family (59%); reputation in the local neighborhood (53%); and, local neighborhood expertise (50%)
“With HENRYs poised to become the next generation of wealth, luxury brands must start planning as to how they will serve this distinctive demographic,” said Anthony Hitt, president and CEO, Engel & Völkers Americas.
“HENRYs define luxury in terms of quality, and they make purchasing decisions based on brand reputation and word of mouth. As such, authenticity has never been more important, and real estate agents should position themselves as trusted advisors and sources of insider information before, during and after the transaction. These consumers are going to seek out agents they feel are knowledgeable and trustworthy — and ones that they can relate to or even aspire to on certain levels.”
When HENRYs are looking to work with a real estate professional, their choice is based on two prevailing factors: reputation and expertise in their local neighborhoods. Given that topic experts are the most followed category of influencers among HENRYs, in addition to HENRYs’ overwhelming reliance on social media influencers in making purchasing decisions, it is becoming increasingly important for real estate agents to start establishing themselves as influencers within their local markets and building rapport with HENRY consumers now.
“We hear the phrase ‘be a digital mayor’ often in our industry, but that’s not enough anymore,” added Hitt. “While you have to have the neighborhood knowledge, you also have to have a niche or distinguishing factor that blends this knowledge with entertainment or aspirational value that will make you a center of influence — building your following and referral base as a result.”