Yes, there are millennials buying homes. Lots of them. Here’s how you can understand this generation and tailor your real estate strategy to fit their needs.
There’s a rumor going around that men and women of the “Millennial Generation” (generally defined as people born between the early 1980s and the early 2000s) aren’t interested in buying homes.
Recent data trends from the US Census Bureau suggest otherwise. In fact, as of July 2018, homeownership rates among people under the age of 35 increased more than any other age group. It seems millennials have arrived in the housing market, and they are ready to buy.
While those in the 18-35 age range have been slow to purchase homes in the past (Urban Wire reports that homeownership among millennials is some 8% lower than along Gen-Xers when they were the same age), it seems the younger generation is catching up to the real estate game.
Why aren’t millennials buying homes?
Buying is finally on the rise, but several factors have contributed to low homeownership rates among 20- and 30-somethings:
- College debt. The younger generation is more educated than any other age group before them—but that education comes with a steep and ever-increasing price tag. Many young people now come out of college with substantial student loans, making it more challenging to save extra money for that down payment.
- Stagnant wages. Despite record growth and low unemployment in recent years, the US Department of Labor continues to report minimal wage growth. Millennials are feeling the pinch, citing increased costs of living and pitiful pay raises. Homeownership often feels like a faraway dream when wages aren’t growing.
- Delaying family life. Younger generations are focusing more on education and career and less on marriage and family. Marriage and children are often the best motivators for homeownership, but since many millennials are starting families later, they’re just now seeing the need for a home to call their own.
What millennials want in a home
Now that 20- and 30-somethings have paid off student debt and managed to save enough for a down payment, what kind of properties are they purchasing?
Millennial home buying trends show they are moving to the suburbs, skipping the fixer-uppers, and doing their research. About half of all buyers in this age group purchase homes outside of major metropolitan areas, possibly because the houses are more affordable away from city centers.
The National Association of Realtors reports that millennials want homes that are already updated and move-in ready. This younger generation is busy, and consequently, they don’t want to purchase a home that needs a great deal of money and time to refurbish.
This age group also gravitates towards homes with open floor plans, energy-efficient homes, and homes with smaller yards for easy maintenance.
How today’s real estate agents can cater to millennial homebuyers
First and foremost, primarily focus your energy online. More than 90% of all millennials begin a home search online, and they are doing their research. Paying attention to details on your website and online listings can make all the difference when appealing to a younger homebuyer.
Here are some tips to help you reach millennial buyers:
- Keep your website updated. Millennials are tech-savvy, and they want a realtor who is, too. Create a user-friendly website using visually appealing themes and keep it updated with new information.
- Be mobile. Millennials conduct business on their phones: from home searches to ordering household goods to working on professional projects, phones are the lifeline to the younger generation. Know how to text, use apps, and otherwise be able to connect with your younger clients via their mobile devices.
- Reach them where they are. Gone are the days of cold calls and flyers. Now, you have to go where the young people are, reaching them on social media and other online outlets. Create and update a blog to gain readers and connect with younger homebuyers, be active on social media, and engage with millennials on their turf.
- Photos, photos, photos! More than ever, visual representation is vital to real estate success. Millennials have unprecedented access to information, and they want to know all about a property before they take the plunge. Make sure your listings include photos—lots and lots of them—and that the photos are professional and crisp, from flattering angles.
Knowing millennial home buying trends can help you connect with your younger clients. Now that this groups makes up 66% of all new homebuyers, it’s time to turn your focus to the next generation of real estate.