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Millennials ... are you ready for them? Pew Research projects that by next year, Millennials will overtake Baby Boomers as the largest generation in the United States. What’s more, half of today’s homeowners are under the age of 36, based on a consumer-housing-trends report from Zillow. With millennial investment on the verge of driving the real estate market, real estate professionals need to understand how Millennials think. Here’s what you need to know.
While Gen X-ers and Baby Boomers were willing to take on a fixer-upper for a better price, Millennials are a different story. “Needs a little work” or “Has great potential” are red flags for this busy generation seeking low-maintenance, low-worry homes. According to the Inc. article “How Millennials Are Changing the Housing Market”, nearly 50 percent of Millennials would rather buy a brand new house in order to avoid any maintenance issues that might occur early on.
And there’s another influence at work here too. Millennials grew up watching HGTV. They ‘instagram’ their lives. They fill Pinterest boards with dream designs for home interiors and exteriors. Is it any wonder that Millennials also expect their future homes to be post-worthy?
Just as Millennials are not big fans of fixer-uppers, they aren’t into starter homes either. Young Millennials economize by living with family or friends longer, a habit that allows them to save up for a down payment. Moreover, having honed the habit of comparison shopping online, Millennials are extending that practice to home searches so they can find the perfect home at the right price. Not surprisingly, a majority of Millennials believe real estate is a good investment, so they are scouring luxury home markets for great deals that also represent solid investments.
It’s a conundrum: Millennials embrace urban living for its convenient access to work, restaurants, bars and shopping, but city living is expensive and Millennials have student loan debt to consider. On the other hand, suburban living gives young Millennial families room to spread out and can be more economical than real estate in desirable urban markets. The answer is walkable suburbs. You’ve undoubtedly noticed a rise in development of mixed use properties—apartments, restaurants, bars, shopping, entertainment venues like movie theatres and even healthcare options—all in one pedestrian-friendly area. The catch? Competition will increase as Baby Boomers look to downsize and escape the high-maintenance landscapes of suburban living.
Given these home-buying preferences, as well as Millennials’ burgeoning economic impact on the real estate market, Real Estate professionals need to strike the right chord with Millennials. By tracking buying patterns, keeping current with hot topics on social media, and following news about key employers, Real Estate professionals can identify drivers and emerging trends that enable more effective, targeted marketing that engages Millennials and helps fuel future success. Are you uncovering the market intelligence you need to win millennial business?