February, 2012 – This article from Inman News discusses an upscale, gated and guarded subdivision developed by Disney. ( http://www.inman.com/news/2012/02/21/your-very-own-magic-kingdom-a-price )

By Mary Umberger

ORLANDO, Fla. — You say you’re thoroughly smitten with all things Disney? You say you’ve been known to joke that you’d practically live at Walt Disney World if you could?

Got millions of dollars to spare?

That’s more or less the cost of admission for owning a home at Golden Oak, an upscale, gated and guarded subdivision that Disney is developing almost in the shadow of its iconic theme parks here — the development is just three miles away from Disney World.

But unlike the popular Disney theme parks, these homes are not approachable for the masses.

At prices ranging from $1.5 million to upwards of $8 million, the developer promises a house and neighborhood with the hallmarks it has carefully cultivated for decades: meticulous attention to detail; extensive personal service; and, if you’re so inclined, a daily dose of Mickey, Minnie and the crew.

Golden Oak’s development team is courting a very well-heeled clientele of Disney diehards that it’s certain are out there, in addition to others who may be lured less by “The Little Mermaid” than by the promise of tight security and a deep trust in the Disney brand.

To read the full article click here.

Posted in Affluence Research, Home Purchases & Remodeling, Vacation Homes | No Comments »

This is an article posted by the Urban Land Institute about Baby Boomer households and their potential demand for high-density housing (http://urbanland.uli.org/Articles/2011/July/DuckerCondo)

by Adam Ducker

Date:  July 21, 2011

As increasing numbers of U.S. baby boomer households enter their empty-nester years and begin to think about retirement—or at least a change of lifestyle—developers should be thinking about what impact this demographic shift will have on the demand for high-density housing. While very much on the sidelines today, this robust group of homebuyers will begin feeling a sense of urgency ahead of the balance of the market, as the desire for new and compelling housing that facilitates a desired lifestyle increasingly outweighs concerns about the market, and their sense of what their current home was once or might be worth.

How many affluent seniors might actually move to a condominium and where? How many will choose to retire to a resort location or other area? Where—and how big—will the markets for these types of housing be?  To answer these questions, RCLCO helped craft a section of the March 2010 American Affluence Research Center survey of the top 10 percent most affluent Americans. Survey respondents, who reflected a range of ages, were asked to “contemplate a change of lifestyle related to retirement and/or their children leaving home.”

Sixty-five percent of respondents, according to survey results, expect to “age in place.” While this is a significant majority of the market, it is less than that of the previous generation, 80 to 90 percent of whom remained in their family homes well into their retirement years, typically until they needed more robust health-care services.

Those who expect to move therefore represent a finite—but still significant—market. Of the households that intend to move, about 60 percent plan to stay in their current metro area, moving to a different single-family, low-density home (40 percent), downtown condo (12 percent), or suburban condo (7 percent). Forty percent of those who expect to move—or 14 percent of all respondents—anticipate moving to a resort or other location.

Not surprisingly, perhaps, more eastern and central state households intend to move in their empty nester years, reflecting the added burden of maintaining a suburban home through the winter and other factors.

When we asked those who said they would consider moving to a condo what factors would appeal to them, we learned that they are equally concerned with unit features and location factors. Fifty-eight percent cited “proximity to restaurants/retail” as one of their top-three factors; amenities such as a pool (35 percent), views (35 percent), and parking (34 percent) also were cited as important.

These prospective condo buyers express a preference for a relatively large unit: 45 percent say they want one that is larger than 2,000 square feet (186 m²) and another 42 percent say they would consider a 1,500- to 2,000-square-foot (139 to 186 m²) unit. Many, however, might be accommodated in a smaller unit that is well designed, highly amenitized, and set in a community with significant on-site storage.

Most of this market still views condos—indeed, any form of post-family housing—as a “buy-down” option, with most (69 percent) expecting to pay more than 20 percent less than the value of their current home and only 4 percent expecting to pay more than the value of their current home. Developers will need to highlight the lifestyle benefits of new construction that offers modern technology, provides a more healthful environment, and reduces reliance on the automobile to inform consumers about the full-value proposition of new in-town housing. To quantify what these findings mean for the overall depth of the market, we examined the size of the affluent populations of major U.S. metro areas that are aged 55 to 74. Of the almost 8.5 million U.S. households that fit into this category, roughly half (4.5 million) reside within one of the nation’s 18 largest metro areas. Demand for high-end empty-nester condos in these key metro areas totals more than 250,000 units, with the deepest markets—New York, Washington, Chicago, and Los Angeles— totaling 20,000 or more potential transactions each.

The results of this survey and our analysis of the depth of the market offer three key takeaway messages for developers:

1) The market for condos targeted to affluent seniors is both meaningful and finite. Significant numbers of households in the largest U.S. metro areas are interested in this housing change. But demand for most products, particularly in smaller metro areas, can be measured in thousands—rather than hundreds of thousands—of units. Wise developers will understand the depth of the markets in which they are active, and will secure sites that are capable of strong market capture.

2) The product expectations of this population are fairly traditional. Prospective purchasers initially will expect large units with plenty of “bells and whistles” in appealing locations.  In high cost markets developers will need to coach some buyers into smaller units to capture as broad a market as possible.

3) Potential buyers’ financial expectations, while somewhat unrealistic, also are fairly traditional. These buyers expect to be moving down rather than up in terms of pricing; sales and marketing professionals will need to educate these consumers regarding the benefits of new construction and the overall value of high-density living.

These findings present challenges for developers, who will need to make smart location decisions and carefully fine tune their product offerings and price points to appeal to older, affluent homebuyers. They also will need to better educate prospective senior condo buyers about the realities of construction costs in order to convince them to accept smaller or more expensive units. The good news is that there is a market for high-end housing for seniors, and that savvy developers who are able to meet the expectations of these homebuyers should experience success in coming years.

Adam Ducker is managing director and director of urban development at RCLCO.

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This is an article from Bowden’s Market Barometer featuring AARC insights based on our Spring 2011 survey. (http://www.bowdensmarketbarometer.com/)

By Judith She

Published June 20, 2011

The spring 2011 Affluent Market Tracking Study conducted by the American Affluence Research Center (AARC) provides an optimistic perception of increased confidence and purchasing activity at the upper tier of the market. The 19th in a continuing series of twice-yearly surveys focuses on the 11.4 million US households that represent the wealthiest 10% of US households, as determined by The Federal Reserve Board, based on net worth.  These households account for about half of all consumer spending and a third of gross domestic product (GDP).

The 405 survey respondents represent households with a minimum net worth of $800,000 in 28 states and the District of Columbia.  At the time of survey, 88% of respondents were married, and the average age was 56.7 years. A full 75% of respondents were over the age of 50. 

Nearly 11% of respondents exhibited a net worth in excess of $6 million, and 6.7% reported average investable assets in excess of $6 million. Overall, the average annual income was $333,000; net worth averaged $3.1 million and investable assets averaged $1.8 million.

The AARC surveys measure and track how luxury and affluent consumers assess current business conditions and their 12-month outlook for the economy, the stock market and their personal household earnings.  Highlights of the survey findings include:

The composite Affluent Consumer Expectations (ACE) Index rose 21 points from the Fall 2010 survey and moved into positive territory.  All three components of the composite ACE Index were well above the Fall 2010 survey results. 

The index for future business conditions rose 23% points
The index for change in the stock market rose 26 points
The index relative to change in after-tax personal income rose 13 points

The assessment of current business conditions is at its best level since the fall 2007 survey. Capital appreciation has again become the primary investment objective, up 14 percentage points, while preservation of capital remains the top priority for those over the age of 60.

Spending plans for all 17 products and services tracked by the AARC surveys were much stronger in the spring compared to the fall 2010 survey.  Items of interest include:

Twenty-six (26%) percent of respondents are planning more domestic travel over the next year while 20% are planning increased international travel. The travel index of 114 is at its highest level since the spring 2007 survey and domestic vacation travel, which rose 15 points from the fall survey, continues to be the strongest category. 

The future spending indices relative to recreational activities – golf, skiing, etc. – rose 13 points since the fall survey, to 95, comparable to the spring 2007 survey.

Approximately 10% of respondents plan to purchase an existing vacation home or build a new one.  This level of interest is essentially at 2007 levels.

Approximately 5% of respondents plan to purchase an existing home as a primary residence or build a new one. 

Given the 11.4 million households represented by the survey, it is estimated that this wealthy market segment represents the potential purchases of 422,000 vacation homes and 536,000 primary residences over the next 12 months.

While familiarity with fractional ownership continues to lag (59% of the affluent say they are not familiar with the concepts of private residence or destination clubs) the incidence of Private Residence Club (PRC) ownership and Destination Club membership has increased significantly. A full 2.0% of respondents now have interest in a Destination Club membership compared to 0.7% in spring 2007 and PRC ownership interest has more than tripled since spring 2007, from 0.5% to 1.6% of wealthy respondents. 

Familiarity with the PRC and Destination Club concepts increases with age, income and net worth: Men more than women; those between the ages of 50 and 59 years; those earning in excess of $200,000 annually; and those with a net worth of more than $6 million are more cognizant of the concept.

The question that comes to mind is how to market this product more effectively.  Based on the AARC findings, social media is not the answer. 

With all the hype about social media — Facebook, LinkedIn, Twitter — a large percentage of wealthy households do not participate in this activity.  The spring 2011 AARC study shows that half of the affluent that do have a mobile device or a computer do not participate in social media.  Among those that do participate, only 25% use it to receive communications from vendors.  Said another way, just 12.5% of affluent households are using social media as a resource for purchases. 

The AARC study goes on to note that as age and income increase, participation in social media decreases. For instance, just 23% of those over the age of 60 participate in social media compared to 57% of those under the age of 50.  This condition is similar with regard to increased wealth; just 24% of respondents with a net worth of $6M+ use social media compared to 47% of those with a net worth of $800,000 to $1.49 million.

So while the National Association of Realtors (NAR) and the National Association of Homebuilders (NAHB) report that nearly 99% of buyers use the Internet to initiate their search for a new primary or secondary home, that number may not have much application to the upper crust. The affluent are buying again – not only because they’ve grown tired of frugal-mania but they recognize that lower prices will lead to greater capital appreciation. Targeting them may best be accomplished by an old fashioned method – the Zip Code. If one lives in a $1M+ neighborhood, one is presumably qualified to purchase a second home, or bigger and better primary home. Let Zip Codes show you where the money is!

Posted in Affluence Research, Home Purchases & Remodeling, Vacation Homes | Comments Off

This is an article from Perspective, The Leading Shared Ownership Magazine, and the article features AARC research that was presented at the Global Networking Expo 2011 for the shared ownership industry (http://perspectivemagazine.com/blog/2011/05/16/interest-in-purchasing-vacation-homes-back-to-pre-crisis-levels)

May 16, 2011

The American Affluence Research Center is releasing its latest data in conjunction with the Global Networking Expo (GNEX) 2011. The data unveiled at the Bahamas event is the latest in a continuing series of twice-yearly surveys that focus on the 11.4 million households that represent the wealthiest 10% of all U.S. households.

The American Affluence Research Center is a private research organization dedicated to providing information about the values, lifestyles, attitudes, investments, and purchasing behavior of the most affluent segments of the U.S. population through both custom and multi-client research studies.

These surveys measure and track how the affluent assess current business conditions and their 12- month outlook for the economy, the stock market, and their personal household earnings. The surveys also monitor the anticipated changes in spending for a variety of different products and services, changes in expected rates of saving, and primary investment objectives. In addition, each survey contains special questions exploring new topics.

Special questions in this edition reveal data on familiarity with the private residence and destination club concepts and current and potential ownership of various types of vacation home access, including whole ownership, timeshares, and private residence and destination clubs. These survey topics and related charts are excerpted in this article. The full study also shows which segments of the affluent will be making a general effort to reduce or defer expenditures during the next 12 months, how the discounts offered in recent years by prestige brands affected their image and sales potential, and how discounts communicated via the internet or mobile devices only to past customers or “members” of “flash sale” sites affect their image and potential sales. The survey also contains a series of questions to identify which segments of the affluent market own mobile devices and which types, the “social media” in which the affluent participate, the use of “social media” to receive regular communications from a manufacturer or retailer for product information, and which “flash sale” sites they are aware of, have visited in the past 90 days, and from which they have ever made a purchase.

Posted in Affluence Research, Vacation Homes, Vacations | No Comments »

This is an article from Sherpa Report The Guide to Shared Luxury Property by Nick Copley (http://www.sherpareport.com/destination-clubs/increasing-interest-shared-vacation-home-0611.html). The article highlights AARC’s latest research on familiarity and interest in shared vacation property.

June 6, 2011
By Nick Copley

The American Affluence Research Center has been surveying wealthy households twice a year for the past decade. The latest survey shows increasing interest in private residence clubs and destination clubs.

The Spring 2011 survey was carried out in March and is the 19th in a continuing series of twice-yearly surveys that focus on the 11.4 million households that represent the wealthiest 10% of all U.S. households. These households are determined by The Federal Reserve Board based on net worth. The survey was conducted by mail among samples drawn at random, and the questions focus on the future outlook and spending plans of the affluent. The 405 participants in this survey have an average annual household income of $333,000, an average primary residence value of $1.2 million, an average net worth of $3.1 million, and average investable assets of $1.8 million.

About 59% of the affluent say they are not familiar with the concepts of private residence or destination clubs. Familiarity with these types of products is strongest among the younger (59 and under), higher income, and higher net worth groups. Familiarity with these concepts was also identified in the Spring surveys in 2009 and 2007. During this 4 year period, the awareness of destination clubs has increased by 9 points or about a third. Awareness of other products has changed very little.

About 10% of the affluent say they will seriously consider acquiring access to a vacation home during the next 12 months. Wholly-owned homes are the most favored type of vacation home access. Wholly-owned homes used primarily on a seasonal basis are more popular than those used frequently throughout the year. About 2.9% are considering two types of vacation home acquisition, such as a wholly owned or a shared home.

The actual interest in private residence clubs and destination clubs shows strong improvement relative to the results of the 2009 and 2007 surveys. On a relative basis, there is increased interest in access to a vacation home through shared access or fractional ownership as opposed to whole ownership. In fact for the higher net worth (greater than $6m) respondents, there is more interest in both destination clubs and private residence clubs, than in a wholly-owned second home that you use frequently throughout the year.

“The increased interest in private residence and destination clubs may reflect two factors. First, the stock market recovery since the 2009 lows has made the affluent feel better about their spending. Second, the recognition that real estate values do not always go up makes the alternatives to full ownership of a vacation home more attractive.” said Ron Kurtz, President of the American Affluence Research Center.

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In contrast to the March general Consumer Confidence Index of The Conference Board, which fell over 10% to the low levels last seen in Fall 2010, the affluent, who account for about half of all consumer spending, report a better outlook for the economy and their personal spending plans in a new Spring 2011 survey by the American Affluence Research Center.

Spending plans for all 17 products and services tracked by these twice-yearly surveys of the wealthiest 10% of US households are much stronger than in the Fall 2010 survey. There is also improvement in the plans to make major expenditures such as for a new auto, a cruise, and a vacation home. These results are consistent with reported sales during the first quarter of 2011.

Given the 11.4 million households represented by this survey, it can be estimated that the market segment represents potential purchases during the next 12 months of 2.4 million autos, 1.5 million home remodeling projects, 1.7 million cruise buyers (total of 3.4 million cruisers), 422,000 vacation homes, and 536,000 primary residences.

Men, those with a $6M+ net worth, and those under age 50 are the most likely to plan the acquisition of one or more of the 8 major expenditures listed. Most of the items have relatively large variations within age, income, and net worth segments. Reflecting a substantial amount of possible additional purchases, the “undecideds” or “don’t know” respondents are relatively numerous for autos (10%), cruises (8%), remodeling (5%), acquisition of a primary residence (4.1%), and acquisition of a vacation home (5.4%).

With the exception of the dining in casual/family restaurants index, which was unchanged, the index for all of the categories rose from the Fall 2010 survey, typically by 7 to 9 points.

The improvement has come primarily from increases in the “same” category and declines in the “less” category rather than increases in the “more” category.

In 16 of the 17 categories, two-thirds or more plan to spend the same or more during the next 12 months. There were 12 such categories in the Fall 2010 survey.

Domestic vacation travel continues to be the strongest category. Most of the categories are now higher than the Spring 2010 survey, when evidence of “frugal fatigue” first appeared in the surveys, and back to the levels of Spring and Fall 2008. The overall average is the highest it has been since 2008.

In 16 of the 17 categories, the segment with the strongest spending indexes is the under age 50 group. The differences within the gender, income, and net worth groups are generally minimal.

In general, the categories of services (vacation and leisure activities) appear to have somewhat better prospects than the other categories of tangible products. All three group spending indexes (home durables, leisure, and vacation travel) increased from the Fall 2010 levels, with the vacation travel category showing the most improvement and the other two groups up slightly less. All three groups are essentially back to 2008 levels.

Participants in the American Affluence Research Center survey have an average annual household income of $333,000, an average primary residence value of $1.2 million, an average net worth of $3.1 million, and average investable assets of $1.8 million.

A description of the Spring 2011 survey methodology and other detailed highlights of the survey can be viewed at:
http://affluenceresearch.org/most-recent-tracking-study/highlights-of-most-recent-survey/

Posted in Cruises, Entertainment & Recreation, Fine Jewelry & Watches, Home Entertainment Equipment, Home Furniture & Furnishings, Home Purchases & Remodeling, Luxury Market & Goods, Restaurants & Dining, Travel, Vacation Homes, Vacations | No Comments »

This is a post from pr-inside.com (http://www.pr-inside.com/keynote-speaker-announced-for-day-one-r2435932.htm) noting Ron Kurtz as the keynote speaker on Day One of the Timeshare and Fractional Networking Expo GNEX 2011.

Keynote Speaker Announced For Day One Of Timeshare And Fractional Networking Expo GNEX 2011

2011-02-23 16:18:43 – Ron Kurtz, president of the American Affluence Research Center, will be the Day One Keynote Speaker for Perspective Magazine’s timeshare and fractional industry networking and awards event.
Perspective Magazine, the independent global leader in providing news and information to the timeshare and fractional industry, announces that Ron Kurtz, president of the American Affluence Research Center, will be the Keynote Speaker for Day One of the Global Networking Expo, GNEX 2011.

“I am very excited to be addressing such an impressive group of vacation ownership industry professionals,” said Mr. Kurtz. “Perspective Magazine is not only a very well respected trade publication but a global brand, providing industry information through a variety of multi-media platforms. GNEX is the latest example of how the company successfully engages the industry and I’m looking forward to the event.”

Mr. Kurtz will be announcing results from his spring 2011 survey of affluent Americans, defined as the wealthiest 10% of U.S. households, analyzing their 12 month outlook for the economy, personal household income and their spending plans pertaining to vacation homes, domestic and international vacation travel.

His discussion will also identify those who say they will seriously consider acquiring a timeshare, destination club membership, fractional unit in a private residence club, or whole ownership of a vacation home during the next 12 months.

Widely quoted in publications such as The Wall Street Journal, Mr. Kurtz has managed assignments for a diverse list of prominent clients that have included American Express, Merrill Lynch, Philip Morris, Home Shopping Network, The Travel Channel, Cable & Wireless, Bahamas Ministry of Tourism and Rio Suites Hotel & Casino.

GNEX 2011 and the Perspective Magazine Awards Gala is scheduled for May 11th – 12th, 2011 at the magnificent Atlantis Resort in Nassau, Bahamas.

Delegates will gather to network with colleagues from around the world in a setting designed to create new ideas for improving industry best practices. The expo will feature a welcome reception, interactive workshops, open networking time, an exhibitor hall and areas to foster individual business opportunities. The event will culminate with the Perspective Magazine Awards Gala where the “Best In Region” and “Best In The World” award winners will be crowned in their respective categories.

“We are privileged to welcome Ron Kurtz as a keynote speaker for GNEX 2011. His up-to-the-minute findings and insights into consumer spending and how that translates to the shared ownership industry will deliver significant value to those attending,” said Paul Mattimoe, president and CEO, Perspective Magazine.

Sponsors and supporters of GNEX 2011 include:

The Absolute World Group, Dial an Exchange, Resort Television, Yucatan Holidays, Citadel Trustees Limited, Connex, First American Title Insurance Company, Interval International, LeisureLink, Max Generation, RCI, First National Trustee Company, Alternative Ownership Conference Asia Pacific (AOCAP), Australian Timeshare & Holiday Ownership Council (ATHOC), Canadian Resort Development Association (CRDA), Cooperative Association of Resort Exchangers (CARE), La Asociación Mexicana de Desarrolladores Turísticos (AMDETUR), Ragatz Fractional Interest Conference, Resort Development Organisation (RDO), Vacation Ownership Association of Southern Africa (VOASA), American Airlines, Avis Rent A Car and Christel House International as Charity of Choice.

For more information and to find out how your company can become a sponsor of GNEX 2011, please visit www.perspectivemagazine.com/gnex

About Ron Kurtz
Ron Kurtz is the founder and president of the American Affluence Research Center, which specializes in surveys and mailing lists of the affluent. With its exclusive focus on the affluent market, the American Affluence Research Center has become a recognized authority and a credible source of reliable insight and marketing information about the values, lifestyles, attitudes, and purchasing behavior of America’s most affluent consumers.

Mr. Kurtz has held the positions of president and chief marketing officer of companies in the cruise and resort industries, including Sea Goddess Cruises, where he created the product category of small deluxe ships for the very affluent. He was also part of the initial development team and a strategic marketing consultant for 6 years to ResidenceSea, operator of The World, which has condominium type apartments that sold for $2 million and up. He also developed the initial marketing plan for the Four Seasons Ocean Residence Club.

He has been a featured speaker at Interval International’s Vacation Ownership Investment Conference, the Ragatz Fractional Investment Conference and the Luxury Interactive Conference.

Mr. Kurtz earned an MBA from The Harvard Graduate School of Business and a BBA from The University of Texas.

About Perspective Magazine
Perspective Magazine publishes four regional brands: industry publications Perspective Magazine North America, Perspective Magazine Europe & Middle East, Perspective Magazine South Africa and Perspective Magazine Asia Pacific. Together, the industry magazines are the most read independent trade publications globally for the shared ownership industry and the company is a media sponsor of 30 major industry events around the world. The company’s consumer magazine, Owners Perspective Magazine, is the only independent consumer publication that specializes in promoting the benefits of buying shared ownership products to the general public. Distribution is via a variety of high-profile consumer channels including, but not limited to, more than 150 first class airport lounges worldwide with over a dozen airlines such as British Airways, Virgin Atlantic, Emirates, Singapore Airlines, American Airlines, United Airlines, and Delta as well as hundreds of luxury hotels, resorts, spas and golf clubs.

For more information visit www.perspectivemagazine.com or email Steve Luba, Director of Public Relations, at steveluba(at)perspectivemagazine.com. For information on advertising and editorial opportunities visit www.perspectivemagazine.com/advertise.

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The potential market for vacation homes, including full ownership and private residence and destination clubs, has declined substantially from 2007 levels, reflecting losses in net worth and a negative 12-month outlook for the economy and personal income among the wealthiest 10% of US households surveyed in March 2009 by The American Affluence Research Center.

The American Affluence Research Center has studied this market every 2 years since 2005. The  Spring 2009 Affluent Market Tracking Study #15 includes relevant comparisons to the 2007 survey results.

Only 4.1% of the respondents indicated serious consideration of the acquisition of a wholly-owned second home during the next 12 months versus 9.8% in 2007. Intent to consider a time share or a private residence or destination club totals less than 1% and is essentially unchanged from 2007.

About 6 in 10 of the affluent market indicate no familiarity with either the private residence or destination club concepts, despite the growth in the numbers, the marketing expenditures, and the media exposure of companies offering these concepts. This represents little or no change in the level of concept familiarity over the past two years. Just over one- third indicated familiarity with the private residence club concept, with 3 in 10 indicating familiarity with the destination club concept. This represents some modest improvement from the 2007 study for both.

Concept familiarity is highest among the higher income and net worth groups. For the private residence club concept, familiarity is about 45% among both the $200K+ income and $1.5M+ net worth segments. For the destination club concept, familiarity is about 40% among the same 2 segments.

Among those indicating familiarity with the private residence club concept, 72% did not name a brand or company with which they are familiar. The other quarter named a hotel-affiliated brand most frequently. Some brands/companies not participating in the business were incorrectly named, thus indicating some confusion about the concept.

Among those indicating familiarity with the destination club concept, 82% did not name a brand with which they are familiar. As some brands/companies were named incorrectly, this indicates some confusion about the concept. Exclusive Resorts was the most frequently and correctly named brand, but by fewer than one in five of those naming a brand.

Among those indicating familiarity with the private residence club concept in the current survey, 12% did not check any of the listed brands (compared to one in five in 2007) as ones they had heard of. Those checking one or more brands averaged 2.9 brands, with 4 of the hotel-affiliated brands checked most frequently.

Among those indicating familiarity with the destination club concept, over half did check at least one of the listed brands as one they had heard of. This was a slight improvement over the 2007 survey. Those checking one or more brands averaged 1.6 brands, with Exclusive Resorts checked by almost two-thirds of the respondents. This is relatively consistent with Spring 2007 results. Ultimate Escapes did not have the recognition of its predecessor Private Escapes.

Over 28% of the sample reported full ownership of a second home with just over half (56%) of the homes used throughout the year and just under half (44%) used primarily on a seasonal basis. An additional total of 15% reported partial access to a vacation home, primarily through a time share, but also through private residence and destination clubs.

As might be expected, the ownership for wholly-owned second homes was most prevalent among the $6M+ net worth group (64%) and the $1.5M to $6M segment (34%). Vacation home ownership was also higher among age 60+ and those with an income of $200K+. Time share ownership was most prevalent among those with an income of $200K+ and those with a net worth of $1M to $1.5M.

The value of the second home generally increased with increases in income, net worth, and the value of the primary residence. The second home at an average value of $781,000 is typically valued at about two-thirds that of the primary residence ($1.2 million).

Second homes used year-round apparently fell by “only”11% in average value, compared to the values reported in the 2007 survey, while those used seasonally declined by 35% in average value.

The survey respondents indicated a negative 12 month outlook for business conditions and personal household income. They also reported declines in their net worth, as a result of substantial declines in the value of their primary home and their investments/savings during the past two years. Together, these factors have contributed to a general attitude toward reducing or deferring expenditures in all areas.

The intentions to acquire a new vacation home are consistent with the overall mood of the affluent market. Over 80% of the survey respondents reported that they had made a general effort to reduce or defer expenditures during the past 12 months, would make a conscious effort to do so during the next 12 months, or had both done so in the past and would continue to do so in the future.

The survey is representative of the population of the most affluent 11.2 million households in the U.S. that account for almost 40% of total personal income and two-thirds of the personal wealth of all Americans.

The 640 men and women included in the national survey have an average annual household income of $290,000, an average primary residence value of $1.2 million, an average net worth of $3.1 million, and average investable assets of $1.4 million. This survey of the affluent market has a maximum margin of error of five percentage points at the 95% confidence level.

Tags: Affluence Research, affluent market, destination clubs, high net worth, luxury, luxury market, luxury research, millionares, second home market, second homes, vacation home market, Vacation Homes
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Negative attitudes about the current economy and the economic outlook for the next 12 months are contributing to plans for deferring the acquisition of both vacation homes and primary residences by affluent consumers during the next year, according to the 15th twice-yearly Affluent Market Tracking Study conducted by the American Affluence Research Center.

In the Spring 2009 survey of the wealthiest 10% of all U.S. households, plans to acquire a new primary residence during the next 12 months were reported by only 2.9% of the affluent consumers. Almost 70% of the homes were expected to be the purchase of an existing home rather than building a new home.

Plans to acquire a vacation home were indicated by 2.3% of the affluent market. About 60% of the vacation homes were expected to be the purchase of an existing home rather than building a new vacation home.

Equal to the potential acquisition of 325,000 primary residences and 258,000 vacation residences, these intentions represent a continued decline from the record lows established in the Fall 2008 survey.

The record highs in this series of studies, which began in Spring 2002, were 9.6% for primary residences in the Fall 2003 survey and 10.5% for vacation homes in the Spring 2005 survey.

The incidence of primary residence acquisition plans is highest among those age 50 to 59 (3.7%) and those with income below $200,000 (3.6%). For vacation home acquisitions, the intentions are highest among those with an income above $200,000 (4.0%) and those with a net worth of $6 million or more (6%).

The survey respondents indicated a negative 12 month outlook for business conditions and personal household income. They also reported declines in their net worth, as a result of substantial declines in the value of their home and their investments/savings during the past two years. Together, these factors have contributed to a general attitude toward reducing or deferring expenditures in all areas.

The intentions to acquire a new primary residence or a new vacation home are consistent with the overall mood of the affluent market. Over 80% of the survey respondents reported that they had made a general effort to reduce or defer expenditures during the past 12 months, would make a conscious effort to do so during the next 12 months, or had both done so in the past and would continue to do so in the future.

The survey is representative of the population of the most affluent 11.2 million households in the U.S. that account for almost 40% of total personal income and two-thirds of the personal wealth of all Americans.

The 640 men and women included in the national survey have an average annual household income of $290,000, an average primary residence value of $1.2 million, an average net worth of $3.1 million, and average investable assets of $1.4 million. This survey of the affluent market has a maximum margin of error of five percentage points at the 95% confidence level.

These surveys track how affluent consumers assess current business conditions and their 12-month outlook for the economy, the stock market, personal household income, and their spending plans for different products and services that include major appliances, home computers, furniture/furnishings, home entertainment equipment, casual and upscale dining out, entertainment, recreation, domestic and international travel, designer and non-designer apparel, collectibles, fine jewelry, and political and charitable contributions.

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Ron Kurtz is President of the American Affluence Research Center, which provides marketing research and mailing lists of affluent consumers to prominent companies targeting the affluent market.

AARC is an independent, private research organization dedicated to providing reliable marketing information about the values, lifestyles, attitudes, investments, and purchasing behavior of the most affluent segments of the U.S. population through both custom and multi-client surveys.

Ron’s experience includes over 20 years in senior management positions in the airline, hotel, and tour business. As the founding President of Sea Goddess Cruises, he created the product category of small deluxe ships for the very affluent. He also served as the chief marketing officer of four cruise lines, including Norwegian Cruise Line and Windstar Cruises.

Ron has been a key contributor to 6 start ups and 11 turnarounds of substantial businesses. He earned his MBA at Harvard Business School.

The American Affluence Research Center CONTACT: Ron Kurtz at 770-740-2200 or info@affluenceresearch.org. Website: http://www.affluenceresearch.org

Tags: Affluence Research, affluence surveys, affluent market, destination clubs, luxury market, new home purchases
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The potential market for vacation homes, including full ownership and private residence and destination clubs, has declined substantially from 2007 levels, reflecting losses in net worth and a negative 12-month outlook for the economy and personal income among the wealthiest 10% of US households surveyed in March 2009.

The American Affluence Research Center has studied this market every 2 years since 2005. The new Spring 2009 survey report includes relevant comparisons to the 2007 survey results.

About 60% of the affluent target market indicates no familiarity with either the private residence or destination club concepts, which represents little or no change from the 2007 survey. Familiarity with the concepts does vary by demographic segment of the affluent.

Among those familiar with the concept, 72% did not name a brand of private residence club with which they are familiar and 82% did not name a brand of destination club with which they are familiar. The majority did indicate recognition of one or more of the 9 brands listed for each concept.

The incidence of access to wholly-owned vacation homes and time share, private residence club, and destination club units was essentially the same as in 2007. Reported plans to seriously consider purchase of one of these options during the next 12 months are about half what they were in 2007.

This new report (21 pages, including 19 tables), provides the following market insight:

• The brands/companies in both businesses with which the affluent report familiarity and how this has changed since 2007.

• The brands/companies in both businesses that the affluent recognize and how this has changed since 2007.

• Which segments of the affluent have the highest level of familiarity with the two concepts and with the brands in each business.

• Current ownership among the affluent of wholly-owned vacation homes and time share, private residence club, and destination club units.

• Plans by the affluent to seriously consider purchase during the next 12 months of wholly-owned vacation homes and time share, private residence club, and destination club units.

• Which segments of the affluent have the highest level of ownership or access to a vacation home and which are most likely to consider such an acquisition during the next 12 months.

• The current estimated value of wholly-owned vacation homes and how the values compare to the value of their primary residences and to vacation home values in 2007.

• The usage of vacation homes throughout the year versus seasonally.

• The distance between the primary residence and the vacation home.

Unlike other affluent and luxury market research that is based on surveying online panels of people who are compensated for responding to regular and frequent surveys, our unique direct mail study is based on samples drawn at random from, and representative of, the select population of the wealthiest 10% of US households.

This report is based on the responses of 640 men and women from households with an average income of $290,000, an average net worth of $3.1 million, and average investable assets of $1.4 million. The average age is 56 and 58% are males.

Tags: Affluence Research, affluence surveys, affluent market, destination clubs, luxury market, private residence ownership
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