Luxury Consumer Perspectives- Affluent Consumers Plan Less Home Remodeling in New Survey
The survey respondents indicated a negative 12 month outlook for business conditions and personal household income. The record high was 34% in the Spring 2005 survey.
Negative attitudes about the current economy and the economic outlook for the next 12 months are contributing to plans for deferring major home remodeling projects by affluent consumers during the next year, according to the Affluent Market Tracking Study #15 conducted by the American Affluence Research Center.
In the Spring 2009 survey of the wealthiest 10% of all U.S. households, only 10% of the affluent consumers reported plans for major home remodeling during the next 12 months. Equal to 1.1 million home remodeling projects, this is less than half the number in the Spring 2008 survey and a record low. The record high was 34% in the Spring 2005 survey.
The incidence of home remodeling plans is highest among those under age 50 (14%), those with income above $200,000 (13%), and those with a net worth of $6 million or more (13%).
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 lower intentions to remodel are consistent with the overall mood of the affluent.
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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ABOUT THE AUTHOR
The American Affluence Research Center, led by AARC President Ron Kurtz, provides marketing research and mailing lists of affluent consumers to prominent companies targeting the affluent market, commonly referred to as The Luxury 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.