By Julie Faupel
Over time, luxury has become a ubiquitous term. In one manner, it was being overused long before the paradigm shift of COVID and the dynamics of 2020 and 2021, but it’s also illustrative of the especially dynamic nature of “luxury” in recent years.
For example, Baby Boomers’ definition of luxury may have been encapsulated in the “things” that they collected, the status implied by driving a European sports car, owning a fine watch, or carrying a specific handbag. Subsequent generations have shifted that definition of luxury to the currency of “experiences.” These consumers focus on the adventure of travel, the joy of live entertainment, or the energy of sporting events shared with friends and loved ones. Of course, unless you were there, these luxuries were less apparent than a hood ornament or a label. But today, enter the technology of social media, and we all get to share in the indulgences of our friends and family as they touted their experiences in real-time.
Now, how does that play out in real estate?
It used to be that a monologue of a beautiful listing – the dreaming about an incredible escape – was enough to entice a visit, a showing, or (at a minimum) an inquiry. Now, we spend literally $100’s of thousands of dollars on those same monologues with little effectiveness and no way of measuring who or why prospects reach out to us about our listings. Enter the age of innovation and change and we are seeing a new breed of trusted advisor emerge; a colleague who is both valued by their personal relationships and enhanced by the data available through technology.
At the intersection of luxury and technology come some very interesting learnings. We’ve emerged from the first three years of this decade, years riddled with uncertainty around a global pandemic, social unrest, political discourse, and natural disasters. Regardless of your age or demographic, luxury has made a monumental shift in the minds of the global population, and we are all, perhaps, a little more united in how we describe, seek and experience “luxury” in our daily life. How many have recently enjoyed a special occasion “Zoom” call with family and/or friends that live great distances away? How many have made “new” friends over Zoom, Skype, or Google Meet? My life has become so technology-centric that I struggle to remember whom I’ve met in person and whom I am strictly a Zoom acquaintance with. That said, I’ve also become more efficient at researching my clients, vetting buyers, and using technology to provide insight and efficiency that never existed before.
At the bottom line of this paradigm shift, there are three things driving our latest definition of luxury…
Time.
Truth.
Trust. Below are some of the trends being shaped by this latest definition of luxury.
Finding Community in New Venues: Time
The value and emphasis on how and where we spend our time were no more evident than during the global pandemic. Emerging from quarantine those with the flexibility to ensure they are not separated from their family or loved ones were seeking refuge with larger properties and compounds. The ability to accommodate generations of family, extended family, and the necessary support staff is critical and driving demand for properties that, historically, would have been more challenging to sell.
Families traveling with chefs, educators, trainers, etc., want to ensure that they have the services they need in accordance with their schedule, and location is imperative. Even now that the borders have opened and travel has increased, technology still prevails. We can literally tour a property, understand the views, and experience the amenities without ever leaving the comfort (or safety) of our own living room, saving valued time and ensuring that our priorities remain where they should be, with family and loved ones.
Urban isn’t bad, it’s back and it’s better. Time and Truth
The global shift in values and how we experienced the mind shift of 2020 and 2021 are also indicators of an emerging definition of luxury. No one’s experience was unilateral, and neither is anyone’s definition of their individual “truth.”
Whether clients have elected to leave the cities altogether or reallocate their time spent in different destinations, it’s become a necessity for them to understand and define their own “truth” and then find creative ways to ensure their expectations can be accommodated. Appreciation for and access to nature. Better air filtration systems. Wellness programming. Public spaces in the city that ensure comfortable distancing for meeting friends and neighbors. A touchless delivery system for room service, dry cleaning, or packages. Developers are embracing these wants and needs and adapting their products to individual truths accordingly.
Making the Lifestyle Accessible: Truth
There’s no denying that there has been a flight to destination markets as we now know that “work” can happen remotely. A trend before COVID and a necessity now, developers are capturing the imagination of the aristocracy who want to be surfers, ski-bums, and cowboys and are making it happen in their high-concept communities. Whether through technology-informed communities that incorporate various lifestyle attributes or through AI that helps us to understand a deeper level of the client’s psychology, the top real estate professionals understand that we need to understand and adapt to their new “truth” before their clients do.
Citizenship, by Investment: Trust
We hear as trusted advisors that many of our clients seeking protection from social unrest and socio-economic risk were frustrated because international travel was restricted. As a result, the affluent are now seeking passport and residency diversification in some spectacular international destinations. In many cases, developers are offering, through the sales launch, preferential pricing, attractive rental returns, and developer buy-back options. If the project is also a Citizenship by Investment-approved developer, a villa purchase provides investors an opportunity to apply for citizenship. With visa-free access (in some cases) to over 140 countries and an attractive tax regime, the affluent are positioning themselves to take full advantage of a completely trusted environment as this trend continues to drive demand.
For many, life today is about adjusting to a new normal in the aftermath of one of the biggest disruptions of all time and the paradigm of luxury is no exception. As the psychology of the world has forever been changed, there is a silver lining in that many of the trends defining today’s luxuries are focused on family, loved ones, health and wellness, and the environment. And, more than ever, it seems that technology is playing a defining role in helping those who serve this demographic in a more efficient and effective way. It’s understood that as trusted advisors we are fostering the luxury of inclusive vs. exclusive by utilizing our own technology-enhanced tools and access to data. We are ushering in a new era of innovation and change and there is no doubt that we have a dynamic future ahead as we continue to navigate the technology and currency of luxury.
