Research that reached me via Facebook this morning helped confirm what I have suspected to be true for some time. It’s not the ultra-wealthy who are the primary buyers of antiques. Middle-class baby boomers, and before them middle-class members of the GI-generation, have traditionally been the buyers of antiques.
The research that reached my desktop this morning is actually from 2009 and titled Popular View of Luxury Spending Debunked in Survey of the Wealthy and is contained at the web site of the American Affluence Research Center. Some of the highlights of conclusions are that some 90 percent of the most affluent are not conspicuous or ostentatious consumers. Moreover, the affluent market is composed primarily of people with middle class backgrounds who continue to pursue a somewhat middle class lifestyle with middle class values. Even more incredible, the affluent market does not appear to be very knowledgeable about the pricing and brands of products that are generally recognized by marketers as being in the higher price points associated with the luxury category.
When ever I visit antiques shows and hear “the top of the market has been unaffected, they are talking primarily about the 10 percent of the affluent who have been busy consuming and are still doing so. Ninety percent have traditionally kept their money in their wallets and still are. The doldrums are instead due to the middle-class consumer being hurt by housing values, unemployment, lack of credit, etc.
With that in mind, we might move over to a recent read of mine titled The Age Curve by Kenneth W. Gronbach. In this book you’ll find lots of information about demographics and trends, including on the middle-class baby boomers, who have most likely been the force behind the antique market since 1980 or so.
To put it simply, many of them are done spending. Worse, Generation X just isn’t a large enough group to support the market even if they had an interest and Generation Y is in its early 20s at its peak, hardly antiques consuming age.
The good news is that Generation’s X and Y love the concept of green. And yes, antiques are green. In fact both high-end antiques all the way down to used furniture are green. The antiques industry has begun to use the concept of green, but unfortunately uses it on baby boomers. It’s with the younger generations with who it resonates best.
To me, all this makes sense. Where is the biggest growth industry in the business right now? In the hotel-oriented or country club high end antiques show? Nope. The Boomers and Silents before them were the source for the proliferation of those type of shows. Expect there will be fewer and fewer. The stregnth in the market is in the high-end auction houses AND in the urban vintage markets- for which Generation Y is providing the momentum. It’s things like fashion and low-cost mid-century items they can use to decorate apartments they are looking for, not Regency chairs and silver servings. Their taste may refine as they get older and begin buying houses, but for now, as far as we can look ahead and see growth, they will be the source of it.
Some facts from THE AGE CURVE:
Baby Boomers– There are 78 million Baby Boomers born between 1945 and 1964. The peak is now cresting 50, the age at which consumption traditionally begins to fall off.
Generation X– There are 69 million members of Generation X, born between 1965 to 1984. There are t0o few of this generation to buy up the McMansions Boomers are trying to sell (and have filled with antiques).
Generation Y– There are 100 members of Generation Y, born after 1985. They are consuming at five times the rate of their Boomer parents in adjusted dollars.
4 thoughts on “The Future of Antiques and Who Buys Luxury”
Good analysis, Eric. As a Boomer, I can verify that I am “done spending”; at least on antiques and collectibles. So are most of my friends. In fact, most of us are considering downsizing. Considering the size of the Boomer cohort, downsizing by many will flood the market and tend to put more downward pressure on prices.
What you are referring to is not technically the Antique market, it’s the Decorator market. The Mid 20th Century items the GenX are buying are not Antiques, but smart Antique dealers are shifting out of the Antique trade and into Decor to stay afloat.
@Mike There’s some truth to that if you are confining antiques to a narrow definition. If you are, then we have to ask, for what purpose. I’m guessing the answer may have the word investment in it. However it would seem that many things that fall outside of that definition are proving better performing investments.
As a high end Antique Restoration studio we have been subject to the highs and lows of the antique market since 1971.This low cycle has lasted longer and is deeper than any we have experienced in 40 years. It certainly rings true to explain the underlying economic trends by acknowledging the link to shrinking real estate values and credit across the board.The individual client who wants the fine piece properly restored is happy to find our skilled staff intact after so many restoration studios have ceased to exist. From time to time it is business as usual, but the volume of high end antiques changing hands or being upgraded is clearly smaller. The high overhead that dealers have is naturally bypassed by internet sales so that is the future. Amazingly, the large audience E-bay attracts, even though it is weighted to low end, supports sales of some high end, high quality goods, without the seller having to promote a separate website, an expense that is beyond most sellers. Thanks to you all for generating this valuable discussion. In the long run it will be the venues with the lowest fees, best security, and speediest transactions that will attract a consistent group of sellers.