Who is HENRY? The acronym, which stands for High Earners Not Rich Yet, represents a segment of the consumer population, made up primarily of millennial and young Gen X homebuyers who earn over $100,000 per year. This niche demographic represents one of the greatest emerging sources of profit for agents—and that’s why Engel & Völkers partnered with Researchscape to survey over 1,000 HENRYs for the “Meet HENRY: Influencing the Next Generation of Wealth” report.
“With HENRYs poised to become the next generation of wealth, luxury brands must start planning as to how they will service this distinctive demographic,” says Anthony Hitt, president and CEO of 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.”
What does brand mean for HENRYs? According to the report, it stands for superior quality for 80 percent of respondents, excellent reputation/word of mouth for 64 percent and premium price for 47 percent. For 44 percent of respondents, it means exceptional customer service and for 42 percent it means innovative.
In relation to purchasing decisions, familiarity with the brand is the biggest influencer for HENRYs, at 69 percent, while reputation for quality was right behind, at 65 percent. Legacy value also plays a role, at 42 percent, while past personal experience and affordable price point tied at 39 percent.
When making decisions, HENRYs are heavily influenced by today’s modern era of technology and internet-based alliances—84 of respondents stated social media played a role in influencing their home-buying decision. In fact, 67 percent of HENRYs follow influencers on social media, with Instagram and Facebook being the most-used platforms (at 67 percent and 55 percent, respectively) and YouTube coming in third at 38 percent.
These individuals are so trusted that 80 percent of HENRYs would consider hiring an influencer they follow for their respective focus areas, including real estate. To be successful with this segment of the population, agents must get in the mindset of these social media influencers in order to establish themselves as experts. According to HENRYs, this means having quality followers (50 percent), being referenced by other influencers (41 percent), having an abundance of followers (38 percent), having few paid posts (37 percent) and being quoted in the media (37 percent).
“We hear the phrase ‘be a digital mayor’ often in our industry, but that’s not enough anymore,” Hitt says. “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.”
HENRYs follow influencers for a number of reasons: entertainment (61 percent); to learn about new products (58 percent); to discover new and interesting ideas (58 percent); to follow the influencer’s lifestyle (50 percent); to learn from the influencer’s expertise (43 percent); and to access insider information on trends (41 percent).
How important is homeownership to today’s HENRYs? The majority (97 percent) either already own property or have plans to purchase a home, while 74 percent already own or would like to purchase a second home. In terms of hiring decisions, HENRYs most often engage real estate agents based on referrals from friends and family (59 percent), while others rely on their neighborhood reputation (53 percent) and local expertise (50 percent). Reviews play a significant role, too—a whopping 98 percent of HENRYs look at a real estate agent’s online network, presence and reviews before hiring them.
HENRYs categorize luxury homes differently than other buyers. For example, the top three characteristics that define a home as “luxury” for this segment are finishes (68 percent), neighborhood and location (64 percent) and amenities (54 percent). Only a small portion of HENRYs (38 percent) say that price plays a role in determining a luxury property.
While luxury brand names are recognized by this generational group—24.3 percent named Gucci, 16.4 percent named Lexus, 14.5 percent named Rolex and 12.5 percent named Mercedes-Benz—members are open to new entrants in the luxury space, making real estate a significant beneficiary while this group accumulates wealth over the next 10-15 years.
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