Luxury Consumer Price Index 2010

Source:胡润百富 Author: IssueTime:2010-06-12

(12 June 2010, Shanghai) Hurun Report, best known for compiling the China Rich List, released the Hurun Luxury Living Index for the fourth year today.

 

Luxury CPI bounces back after financial crisis 



  • Hurun Luxury      Living Index rises by 11.3%, more than double last year’s figure, and 8%      faster than CPI

  • Luxury property      hike is key driver with prices increasing by 45.1% yoy

(12 June 2010, Shanghai) Hurun Report, best known for compiling the China Rich List, released the Hurun Luxury Living Index for the fourth year today. The Hurun Luxury Living Index compares the retail price changes of a basket of 58 luxury products from 1 June 2009 to 1 June 2010.  The Luxury Living Index grew to 11.3% in June year on year, up from a low of 4.6% last year, and nine percentage points higher than the CPI, which grew 3.1% year on year in May.

The announcement of the Luxury Living Index coincides with the release of the Hurun ‘New Aristocracy’ Threshold, the “cash on the table” required for a family unit to pursue a super luxury, or xinguizu, lifestyle in China. Driven by rising property prices, the threshold rose to RMB 106 million this year, a 22% rise on last year. For a family unit in Shanghai, this includes RMB 29.8 million, or USD 5.8 million, for a luxury villa and downtown apartment in Shanghai. According to the results of the Hurun Best of the Best Survey 2010, travel is the leisure activity of choice amongst China’s wealthy, and therefore it is no surprise to find that this year’s threshold includes a spend of RMB 7 million, or USD 1million, on a holiday home in Sanya, the most popular domestic travel destination amongst China’s rich.

“It is getting more expensive to buy one’s way into China’s elite inner circle,” said Hurun Report founder and chief researcher Rupert Hoogewerf, “Demand, driven by more wealth creators looking for ever more sophisticated luxury products, is far outstripping supply. The price of a luxury property in Shanghai, for example, has almost tripled in the past four years.”

 Luxury property prices rose 45.1% year on year in June, almost four times larger than the increase of any other category, after a fall of 1.8% last year. A 750 square meter luxury villa in Shanghai, for example, has jumped 90% in value over the past year, now costing RMB 71 million (or, US$13,860 a square metre), and up from a ‘mere’ RMB 28 million in 2006. Property has grown at a much more significant rate than any other category, rising by 13.9% and 29.8% in 2007 and 2008. The limited supply of luxury property in the face of strong demand, in the context of a generally buoyant housing market, was a significant factor in large increases such as these. One exception to the rule was the cost of buying an overseas retreat; the price of a 350sqm holiday villa on the Australian Gold Coast fell 4% in comparison with last year.

Whilst the strength of the yuan continued to drive down prices for international travel, there has been a luxury travel boom domestically, which has contributed to an overall price hike, up 13.4% after a 6.5% fall last year. A luxury suite in the Peninsula Hong Kong, for example, rose by 47% year on year.

Automobiles and yachts rose by an average of 1.5% compared to 3.2% last year, led by a 12% hike in the Rolls-Royce Phantom to RMB 9.2 million. The drop in sterling and the euro compared with the yuan, meant that a Sunseeker Manhattan 70 yacht, for example, saw its relative price fall by 10%.

 

 

Luxury drinks rose at a similar rate to last year, 9.1% as opposed to 10% in 2009. Fine Bordeaux reds and the top-end Chinese baijiu led the way with price hikes of thirty percent or more. Château Lafite Rothschild and Moutai 30 Years rose 36.6% and 29.6% respectively. Other imported luxury drink brands reacted to strong demand with prestige pricing strategies. A bottle of Louis XIII, for example, now costs RMB 17,580, up 17.4% year on year, and an average of 10% every year since 2006, when a bottle cost RMB 9800.

Executive education fees continued to rise, albeit at a slightly lower rate than last year, 5.3% as opposed to 9.5% last year. However, the fees for the well-considered Tsinghua University Executive MBA, for example, continued to outperform, rising to RMB 450,000, up 18.4% compared with last year and from RMB 250,000 in 2006.  Expect to see many more Chinese students studying abroad, as the continuing strength of the yuan made the cost of overseas courses cheaper.

Demand continues to be strong. There are now 875,000 individuals in China with personal wealth of RMB 10 million or more (equivalent to USD 1.5 million), up 6.1% over the past year, and 55,000 individuals with RMB 100 million (equivalent to UDS 15 million), up 7.8%, according to the Hurun Wealth Report 2010 released in April.

 In the year to 1 June 2010, the Euro fell 14.6% against the yuan, whilst the pound fell 11%.

 

Hurun Luxury Living Index 2010

Products

2010   Retail Price (RMB)

Percentage Increase



11.3%

Automobiles   and Yachts


1.5%

Rolls-Royce   Phantom EWB

9180000

12%

BMW 740

1378000

-2.3%

BMW Z4   3.0si

738000

5.4%

Range   Rover V8 4.4

1728000

-8.1

Porsche   911 Turbo

2267500

5.2%

Sunseeker   Manhattan 70

26000000

-10%

Audi A6L 2.0T FSI / MT

372500

7%

Mercedes-Benz   S500L

2153000

2.6%

Watches   and jewelry


3.2%

Patek   Philippe (Nautilus 5712/1A)

280700

0%

Rolex   (Oyster Perpetual Datejust 116233)

87100

0%

Cartier   (Love Bracelet)

39900

7.3%

Piaget   (Polo GOA32039)

216500

5.2%

Montblanc   (Meisterstück 149 Fountain Pen)

6340

0%

Swarovski    (661065)

2000

7%

Clothes,   skincare and accessories


0.3%

Louis   Vuitton (Speedy Bag)

5800

3.6%

Chanel (A01112 Bag)

23200

1.8%

Ermenegildo   Zegna

23000

9.5%

Hermes   (90cm Scarf)

3500

2.9%

Vertu   Signature Rose Gold

230000

-8%

Nokia   8800a 4G

9000

-7.2%

LA MER   (Cream 60ml)

2600

0%

Lancôme (Secret de la Vie 50ml)

3580

0%

Property   and interiors


45.1%

Shanghai   Shimao Sheshan Villa (750)

71250000

90%

Shanghai   Tomson Golf Villa (417)

29750000

70%

Nanjing   Zhongshan International Golf Villa (600)

32000000

39.1%


  Mission Hills in Residence (203
villa)

14210000

16.7%

 Beijng   Star River (347   apartment)

20820000

57.9%

 Beijing   Ligong  (788   villa)

47280000

125.1%

Australia   Gold Coast, Links Royale Hope Island

12000000

-4%

Yundian   Furniture

394100

0.00%

Steinway   (Concert Grand D)

1658360

11.1%

Drinks and   Smokes


9.1%

Richard   Hennessy

24200

0%

Louis XIII  

17580

17.4%

Royal   Salute 21 Years Old

1280

8.5%

Chivas 18   years

608

1.3%

Johnnie   Walker Blue Label

1678

3.7%

Moutai 30   Years

12800

29.6%

Swellfun

880

0%

Lafite

344197

36.6%

Davidoff   Cigar No.2

3400

0%

Panda   Cigarettes

80

0%

Zhonghua   Cigarettes

78

3.6%

 Business   and Clubs


3.7%

Hawker   Private Jet 800XP

28000

-6.7%

Mission   Hills Golf Club Diamond Membership

1800000

7.1%

Sheshan   Golf Club Membership

1680000

0%

Nine   Dragons Hill Polo Club

500000

11.1%

Chang'an   Club Membership

150000

0%

Fuchun   Resort Golf

1020000

10.9%

Education


5.3%

Tsinghua   University EMBA

450000

18.4%

CKGSB EMBA

530000

0%

CEIBS EMBA

459200

12.2%

Wycombe   Abbey School

73100

-5.7%

Eton   Summer Course

56000

1.8%

Travel 


13.4%

Lijiang   Banyan Tree (Deluxe Pool Villa) 3nights

11400

-2.8%

Peninsula   Hong Kong (Superior Harbor View Suite) 3 nights

26940

46.7%

Pudong   Shangri-la Hotel 1 nights

4888

1.8%

Peninsula   Hong Kong Presidential Suite 1 nights

68000

10%

Pudong   Shangri-la Hotel Presidential Suite  1 nights

51750

11.3%

 2010.png


  

Luxury Living Index & CPI 2007-10

 

 

About Hurun Report Inc.

 

Nobody Knows China’s Rich Better!

 

Established as a research unit in 1999 by British accountant Rupert Hoogewerf, Hurun Report Inc. has grown into a leading research house, media and lifestyle investments business based in Shanghai, China, best-known for its rankings of the richest people in China, India and the rest of the world.

 

Hurun Report Inc. has four divisions: Hurun Research Institute; Hurun Media; Hurun Conferences and Training, an active events division targeting entrepreneurs and high net worth individuals; and Hurun Lifestyle and Investments, with investments in education, interior design, horses, bespoke tailoring, media and retail.

 


 

For media inquiries, please contact:

Hurun Report

Porsha Pan

Tel: +86-21-50105808*601

Mobile: +86-139 1838 7446

Email: porsha.pan@hurun.net