A new trend in the United States has had a very positive residual effect on an industry that is seeing the growth it definitely did not expect.
Thanks to the pandemic, and the lockdowns enforced by governments, there are now a record number of young adults living at home with their parents.
That means kids with jobs are saving a fortune by not paying rent like they usually would, and the by-product is a massive boom in the sale of luxury goods.
Instead of scratching a check to a landlord every month, young adults are giving those funds to Gucci, Louis Vuitton, Rolex, Chanel, and other luxury brands.
The official number is around 48% of people aged 18-29 live with their parents, the highest number the census bureau has seen since the 1940s.
Luxury retailers are ecstatic about this because Gen Z and Gen X consumers have a lot more disposable income since mom and dad give them free rent and in many cases, food and utilities.
Here’s what an analyst for Morgan Stanley said about this trend and how it has helped luxury retailers.
“This is, of course, not the only reason luxury-goods consumers are getting younger in the West social media playing also an important part) but we see it as fundamentally positive for the industry.”
The primary reasons young adults are staying at home are the obvious ones; 51% say it’s to save money, and 39% can’t afford rent on their own.
There’s a reason the head of the luxury-goods conglomerate LVMH is the richest person in the world. The company owns Louis Vuitton, Dior, Tiffany, Moet Hennessy, and many others, and revenue is up almost 20% in 2022.
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