Young Adults Living at Home Spending on Luxury Goods

With a record number of young adults in the U.S currently living at home, all that saved rent is sparking an increase in sales of luxury goods, Business Insider reports.

Data from the U.S. Census Bureau shows that nearly half of young Americans between the ages of 18 and 29 are living with their parents today. That’s a historical high not seen since the Great Depression era, Morgan Stanley analysts wrote in a recent note.

That’s actually great news for luxury retailers, because saving on daily necessities like rent and groceries is freeing up disposable income for discretionary spending, a team of Morgan Stanley analysts led by Edouard Aubin found.

“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 analysts wrote in the note.

Among retailers benefiting from this trend: The British luxury brand Burberry reported an 11 percent year-over-year increase in sales in the quarter ending in September, and the luxury-goods maker LVMH, whose brands include Dior, Tiffany, Moët Hennessy and Louis Vuitton, reported a 19 percent year-over-year increase in revenue for the third quarter of 2022.

Click here to read the full article.