An Industry Update from cotton & company
Election Year Impact on Luxury Real Estate
With the upcoming Presidential election, the United States' economy, commerce, and real estate have become hot topics. Looking at past history, the Presidential election and the voters’ attitudes towards it often has an impact on consumer spending habits.
With such a diverse range of options in the 2016 Presidential Election, the future direction of the country is up for grabs. As we enter into the summer convention season, there remains a veil of uncertainty hanging over the US economy. Real estate markets around the country are feeling the pinch due to low consumer confidence as a result of this uncertainty. In destination second home markets, buyers are patiently sitting on the sidelines waiting to jump back in. This could signal an opportunity for savvy investors who recognize this as a momentary pause, creating new opportunities for negotiation with nervous sellers.
With Cotton & Company’s diverse client roster, we continue to see steady consumer interest. Website traffic and online registrations have remained strong through Q1 2016. The timeline to purchase is taking longer to convert, with buyers often making multiple site visits. Building a pipeline of leads during this time period and maintaining a strong follow-up program should result in a return to normal activity once the election season settles down. Dramatic population and geographic relocation trends indicate a bright future for second home destinations. Aging U.S. homeowners are still seeking warmer climates and amenity-rich communities with experience driven lifestyles.
Empty Nesters Seek New Urban Retreats
We are seeing more and more Empty Nesters who can afford large homes—but who are choosing much smaller spaces for a taste of the urban lifestyle. They want areas with great restaurants, culture, and entertainment, within easy reach. Empty Nesters have spent most of their lives in cars and now want the convenience of location and a walkable lifestyle where they can enjoy an evening without having to designate a driver. Their childhood destinations were the grocery store down the street or an ice cream shop on the corner. Now, it’s a health-food store down the street and a hip coffee house with Wi-Fi on the corner.
Empty Nesters are trending towards homes designed with efficiency in mind—a shift away from traditional to more modern design. They don’t want a living room, family room, or dedicated dining room. Instead, they want open floor plans with very few or no hallways, higher ceilings and floor-to-ceiling windows. There is less compartmentalization of spaces. With more convenience and less maintenance, they have more time to explore the urban lifestyle they crave.
With a Steady Increase in Mobile Device Users...
How Should Your Digital Marketing Assets Evolve?
Digital marketing has shifted and evolved dramatically over the last few years. The significant increase in the use of mobile devices has created the need for constant innovation and development in the marketing world. Creating dynamic digital content that is generated specifically for integration with mobile devices has become more and more essential to every marketing program.
With larger smart phone screens and smaller iPads, the consumer is browsing the Internet on the go. Responsive programming must be at the forefront of website design, and mobile platforms can no longer be treated as an afterthought. With consumers' subconscious need for instant gratification, it is important for a website to provide optimal viewing and interaction. The mobile experience should incorporate an increased visual presentation with scrolling capability built into the navigation protocol. With responsive programming, the website is located under a single URL, resulting in a positive effect on your SEO efforts and search engine rankings. With Google now limiting the PPC positions, strong SEO is a necessity to continually improve your relevancy scores and search results.
Social Marketing is the Most Efficient Method of Delivering a Compelling Sales Message to Highly Targeted Home Buyers
One of the most important issues facing real estate sales today is being able to deliver a compelling sales message that reaches the right audience with the right message. With diverse personalities and interests, it is not about telling one story but about telling hundreds—from every point of view.
The market today is looking for customer engagement marketing – an integrated process that combines the traditional elements of direct marketing and customer contact centers, including data analytics, campaign management, e-commerce and fulfillment, to deliver relevant, personalized and timely customer interactions across all channels. The goal is to create one-to-one customer experiences at every touch point, with every single communication in a seamless fashion. What’s important is to get above the clutter of the hundreds of communications that people receive every day and to create and deliver the right messages that are personal, relevant, convenient and actionable. The right customer is everything. You don’t need a lot of “likes” in Facebook. Social Marketing is all about delivering qualified traffic to your primary website.
What’s New for 2016
Millennials will become a dominant force in the housing market as their personal financial conditions improve with the recovering economy. Their desire for smaller homes is having an impact in the development of primary housing in high growth areas. Two other generations are having a more immediate effect on the market in 2016. Gen Xers are in their prime earning years and thus able to move up within their geographic region or are relocating for new job opportunities. New home design innovation and energy-efficiency remain high on the priority list. Baby Boomers are the dominant force in 2016 as they are entering retirement and seeking a lifestyle change.
Also trending for 2016 are customers as literal moving targets. Always on the go, they’re searching for real estate on their smart phones. If they’re home, they probably have their tablet by their side. We’ve found a strong mobile marketing strategy to be a critical element of a successful real estate marketing plan. We’ve already seen great success this year with consumer engagement strategies including enhanced video content with shorter more personalized messaging, direct response engagement through social channels, and affiliate marketing with key influencers.
Offshore Properties Coming Back to Life
The recent record-breaking growth in tourism, combined with new and on-going government incentives and investments in airports, highways and marinas, has contributed to an increase in luxury real estate sales in several Caribbean and Island destinations, positioning the region for growth in 2016. International property buyers continue to be drawn to the region's consistent offer of year-round sun, sea, sand, stability and style of living. In fact, the offshore market may be the beneficiary of the uncertainty of the U.S. election outcome.
Opportunity is found where challenges exists. In Puerto Rico, government initiatives are being put into place to drive new investment in the island economy. Act 20/22 is in place to provide tax advantage for U.S. consumers who invest in primary residential properties. Coco Beach Golf Resort and Residences (the former Trump Puerto Rico) is under new ownership. Cotton & Company is assisting in the long-range planning for this master-planned community that plays host to the PGA Tour’s Puerto Rico Open golf tournament.
Expanded airline service to the Exumas is also creating new energy and momentum for McGarvey Development’s February Point on Great Exuma. A new Beach Club and Marina are the latest additions to this popular private community. McGarvey has begun construction on new luxury condominiums, from $1.5 million, that will be move-in ready later this year. The community also introduced The Bahamas’ first overwater penthouses, priced from $5 million.