China’s luxury market: changing in a shrinking economy – Rupert Hoogewerf

 

Rupert Hoogewerf

China’s economy is facing rough weather, but while the luxury market has its problems, some segments are doing better than ever, says Rupert Hoogewerf, Hurun Report Chairman and Chief Researcher at the Hurun Report. And more important, the happiness of China’s high net worth individuals is increasing he adds at the  20th anniversary of the Hurun Best of the Best Awards.

Rupert Hoogewerf:

“This year marks the 20th anniversary of the Hurun Best of the Best Awards, our 20th year of tracking the brand choices and lifestyle changes of China’s luxury consumers.”

“Although the size of the luxury car market, defined as cars costing over CNY500,000, has continued to shrink, the size of other premium industries has basically increased, especially the likes of luxury travel and traditional luxury, bringing the overall size of China’s premium market up 3% to CNY1.7tn. In China, this is one of the rare trillion-Yuan industries, others including elderly care, automobiles, real estate, etc… China’s luxury consumers are now undoubtedly the world’s biggest spenders when it comes to luxury in the world.”

“With the global economy facing many uncertainties, the Hurun Economic Confidence Index of China’s high net worth individuals has declined for the second year, but is still at a high level compared with the past. This year, the Hurun Happiness Index is at its highest level for a decade, especially for Generation X and in terms of family life.”

“In the coming year, China’s HNWIs surveyed plan to increase their investments in gold, funds and bank deposits, and decrease their investments in real estate, both for residential and commercial, and art.”

“Gifting continues to be on the rise again, with Chinese HNWI males preferring to gift watches, baijiu and electronic products.”

“The priorities of China’s HNWIs have changed dramatically. ‘Health’ becomes the most important thing. High net worth individuals also increased their enthusiasm for exercise by 20%. The UHNWIs demand nutritionists and family doctors more than investment advisers.”

More at the Hurun Report.

Rupert Hoogewerf is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers’ request form. 

Are you looking for more experts on China’s luxury market? Do check out this list.

Pleas

The uptick in spending on real estate, Tesla and Baijiu - Rupert Hoogewerf

Rupert Hoogewerf

The China's luxury Consumer Price Index (CPI) rose 3.6% on a yearly basis in 2017, both based on more wealthy Chinese, and an uptick in the money they spend. Chief researcher of the Hurun China rich list Rupert Hoogewerf says expenditure on real estate, Tesla and Baijiu going up, he tells in Asia Times.

Asia Times:

The Luxury Consumer Price Index, released by Hurun each year, aims to measure the price changes for a predetermined basket of goods and services purchased by China's high-net-worth individuals (HNWI). The index covers the consumption activities of wealthy Chinese in the following 11 categories: real estate, health, education, luxury tourism, weddings, watches & jewelry, accessories & beauty products, cruises & private jets, lifestyle, liquor & cigarettes, and automobiles. 

The 2017 index, which gauges prices from June 2016 to June 2017, was calculated based on a basket of 116 high-end goods and services, 20% of them imported. The issue marks the 11th edition of the index. 

The depreciation of the Chinese yuan against major global currencies over the past year has been the main reason for the decreasing purchasing power of China's rich population with respect to buying luxury property worldwide and high-end imported goods. 

Based on Hurun's estimates, there were nearly 1.34 million HNWIs in mainland #China by May 2016, while the number of individuals with over a billion yuan of wealth was close to 89,000. Over the past year, this population has borne the brunt of the price spike in the areas of luxury property, liquor, lifestyle and travel. 

'What impresses me most, this year, is how much the price of real estate, baijiu (a traditional Chinese liquor) and Tesla has increased,'said Rupert Hoogewerf, chairman and chief researcher of the institute, 'completely lifting up the luxury CPI.' 

For affluent Chinese buyers, the price of luxury property has gone up 16.6% since last year. Domestically, a villa in China's southwestern city Chengdu spiked 56.5%, followed by properties in Hainan (a rising tourism city) and Shanghai. Housing prices in overseas cities such as Vancouver, San Francisco, Los Angeles and New York also jumped.

More in Asia Times.

Rupert Hoogewerf is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form. 

Are you looking for more experts on luxury goods at the China Speakers Bureau? Do check out this list.    

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