Unless you’ve been living in a cave lately, you’ve probably heard the new trendy term, “Millennials”, floating around. Millennial generally refers to the generation of people born between the early 1980s and the early 2000s. Perhaps the most commonly used birth range for this group is 1982-2000. The Millennial Generation is also known as Generation Y, because it comes after Generation X — those born between the early 1960s and the 1980s. It has also been called the “Peter Pan” or “Boomerang Generation” because of the propensity of some to move back in with their parents, perhaps due to economic constraints, and a growing tendency to delay some of the typical adulthood rites of passage like marriage or starting a career. However, with interest rates and home prices sitting at such low levels, now is a great time to buy a house, experts claim, because mortgage payments may be cheaper than what it would cost to rent a space—and Millennials are taking note. But it’s not their parents’ house that they are looking to move into.
According to a Better Homes and Gardens Real Estate survey of 1,000 18 to 35-year-olds, this new generation of homebuyers is reinterpreting traditional norms, seeking customized purposeful homes to fit their values. Unlike previous generations, 77% of respondents prefer an “essential” home equipped with the technological capabilities they have grown accustomed to, as opposed to the stereotypical luxury homes preferred by many in their parents’ generation. What’s more, 43% want their living quarters to be as unique as they are—more customized and less cookie cutter. More than half (56%) believe home tech capabilities are more important than “curb appeal”. Living in the city is definitely a motivator for Millennials. They don’t want long commutes and do want to be able to walk to restaurants—even if they have to compromise neighborhood or the age of a house. Lifestyle and a strong sense of community are definitely what counts to this younger generation.
Millennials have grown up in an environment of Internet resources, instant worldwide communications, digital technologies, iPhones, texting, Facebook, Twitter and intense multi-tasking. These tech-savvy homebuyers, now in their household formation years, are intelligent, articulate, detailed, and armed with a textbook buyer’s market sophistication and mentality. If they say “Sell my house fast San Antonio” – they mean it. Generation Y buyers have a distinct advantage with their intuitive use of the social media and Internet services for instant online market research, comparison and analysis. Although most Millennials are first-time homebuyers, many of them possess the knowledge of long-term seasoned veteran buyers. It’s not uncommon for Millennial buyers to arrive at the sales office or subject property equipped with a bevy of spreadsheets from various online services including Realtor.com, Zillow, Redfin, Craigslist and other sites that provide detailed information on communities, neighborhoods, and amenities.
The first step to a successful relationship and closing with this Millennial buyer base is to speak the language by using text messaging and emails, which are much more preferable to phone calls, at least initially. Because they tend to be market savvy, Generation Y buyers are value and quality driven and are typically more concerned with price per square foot than total square footage. In other words, unlike their parents, large homes with unused formal rooms and leisure areas are costly and unnecessary to this budget-minded homebuyer.
Eight out of 10 millennials believe that owning a home is “part of the American dream.” They are swarming into the housing market armed with information, ideas and a passionate desire for personalization. This generations is ready for homes that reflect their individuality and their sheer size will reshape the housing market for decades to come.