Is TikTok making the luxury market younger? According to experts, Gen Z and millennials are buying luxury goods younger than ever before, and we’re finally seeing it seep into the real estate industry.
A new report from consulting company Bain & Co. shows Gen Z has started purchasing luxury goods such as designer handbags and shoes to watches and jewelry as young as 15 to 17 years old, a drop from the previous generation’s 18 to 20. And thanks to viral TikTok videos of real estate agents showing multimillion-dollar homes, experts think this new way of open housing (if you will) could be causing a surge in the luxury market.
In 2022, Bain & Co. reported Gen Z and millennials accounted for all of the luxury market’s growth and are expected to make up a third of the market through 2030.
“By 2030, younger generations (Generations Y, Z, and Alpha) will become the biggest buyers of luxury by far, representing 80 percent of global purchases,” they reported.
While Wells Fargo is predicting a drop in new-home and existing-home sales this coming year, luxury listings are projected to rise between three to eight percent, depending on a few external factors. But so far, they seem to have been immune to the pitfalls of the rest of the housing industry, from rising interest rates to high inflation.
“What has changed is the affluence level of the U.S. customer and the prevalence of social media that tells the customer what is cool, ” said Jan Rogers Kniffen, CEO of retail consulting firm J Rogers Kniffen WWE. “The generation before the Z’s pushed the age of first luxury purchase to 18 to 20. Wasn’t 15 to 17 the next logical stop? Is that the bottom? Probably not.”
Currently, just searching “#property” on TikTok has three billion views alone, with “#housetour” at a whopping 10.2 billion and “#realestate” at 21.6 billion. The younger market seems to have a taste for real estate, whether it’s escapism or aspiration, but one thing is clear – agents have a lot of room to find success on this developing trend.
If you’re interested in luxurious living, Baird & Warner can help (even if you don’t have a TikTok account). Reach out to one of our agents today to get started on finding the perfect home for you.