Millennials Buying Homes: 14 Facts About the Millennial Home Buyer
Are millennials buying homes? Yes, and they're an unpredictable client. This isn't impossible for a realtor. Just know these 14 facts about millennial buyer.
According to research, more than half of millennials are planning to buy a house within the next five years.
With millennials predicted to become America's largest generation in 2019, that is a lot of potential house sales! And although not all those in generation Y may fulfill their plans to buy homes in the near future, they already have a pretty good home buying track record. According to research by NAR, millennials accounted for up 32% of the market's recent buyers.
With so many millennials buying homes, as a realtor or a home seller, it is important to cater to their tastes and needs.
Understanding millennial home buyers is key to taking advantage of this growing segment in the housing market. But, the millennials are not so easy to understand. They have a wide range of tastes and influence and are unlike any other generation.
Fortunately, we have done the legwork for you and uncovered the top 14 facts that you need to know about millennial home buyers. So that you can capitalize on this burgeoning category of home buyers.
Read on to find out what these are.
1. They Look Online First
Not surprisingly, millennials are prone to turn to Google as their first port of call when looking to purchase a home. Research driven, they are likely to utilize search results far more than their older counterparts.
Millennials are also likely to use their phones when browsing the web for potential homes. This means that realtor's sites better be mobile optimized for them to garner in business.
2. They Only Want to Work with a Trustworthy Agent
With millennials valuing transparency and integrity, it also comes as no surprise that they only want to work with trustworthy agents. Millennials are also a savvy bunch that can easily find out on their own time about clauses, terms of sale and buyer's protection rights.
If they feel they are being hoodwinked, millennial home buyers are quick to look elsewhere.
3. Their Main Obstacle Is the down Payments
As millennials are often faced with student debt, a tough job landscape, inflated living costs, and low interest rates, one of the biggest obstacles between them and purchasing a home is the down payment.
Many millennials are money smart, thanks to being born in the recession. However, even this may not ensure that they are able to accumulate enough to meet a standard deposit. A large portion of millennials hope to make a minimum down payment, but pay off their installments fast.
4. Most Millennials Buying Homes Are Willing to Spend Between $100,000 and $200,000
If you were wondering what price bracket will draw in millennial buyers, most are willing or able to pay between $100,000 and $200,000. At the same time, there are some who are willing to spend more than this.
5. Millennials Do like Traditional Designs
Contrary to assumption, not all millennials want inner city slick as the aesthetic for their homes. Many millennials, in fact, are drawn to old world charm. Designs such as pre-war homes, mid-century and Mediterranean themes are popular among generation Y.
6. They Want Control over Their Living Space
One of the top reasons why millennials wish to buy their own home is because they want to have absolute control over their personal space. They want to paint, upgrade and change, things that most renters cannot do.
7. They Love Farmhouse Sinks and Integrated Cabinetry
Farmhouse sinks have taken Instagram decor uploads hostage, and many millennials would prefer to have a farmhouse sink in their house as opposed to any other.
Millennial home buyers are also partial to integrated cabinetry. This style makes for clean lines and is right on trend with the airy and minimal design trend that is in swing.
8. One-Third of Millennial Buyers Will Make an Offer Before Viewing a Property
Thanks to things like 3D virtual reality tours -a groundbreaking trend in real estate technology - up to one-third of millennial home buyers will put in an offer without seeing a property, according to research by Redfin.
This illustrates how important it is to take advantage of the new and innovative technology that is now available to real estate agents.
9. Millennials Are Prone to Sharing their Buying Experience
A report from Nielsen reveals that the average adult spends 11 hours per day consuming and interacting with content. The report also shows that people spend an average of 45 minutes per day on social networks.
Thanks to this super-connectivity, millennial home buyers are very likely to share their home buying experiences on social media. Real estate agents will do well to take this into account when dealing with millennial home buyers.
10. Commuting Cost Are Very Important to Millennials
Further research also uncovers the fact that commuting costs play a role in millennial's home buying decisions. A relatively money savvy lot, thanks to being born during the recession, homebuyers belonging to generation Y do not want to waste money on traveling expenses.
At the same time, millennials are also showing a trend towards suburban living. Many millennial buyers need increased space. A lot of millennials have had to delay home purchases thanks to the economic climate, which has led to this generation largely skipping 'starter homes'.
Many millennials are also showing an aversion to sharing walls with their neighbors and prefer to invest in suburban style stand-alone houses.
11. They Know What They Want and Can Be Quick to Close
One of the common physiological elements of first time home buyers is not knowing what they want.
Not so with millennials. Thanks to having to put off purchasing a home due to financial pressures of student loans and other stressors, by the time millennials are ready to buy they can be pretty clear on what they need and want.
Their aptitude for research and internet usage can also result in millennials being able to secure financing for their home quicker than previous generations.
12. Millennials Want Smart Tech in Their Homes and Are Willing to Pay for It
Considering that millennials have grown up in an increasingly technologically rich time, it is not surprising that they value tech in their homes.
According to one survey, 86% of millennials are willing to pay higher rent for houses and apartments that have smart technology such as key-less door locks.
This preference logically spills over into the housing market as well. Sellers would do well to consider installing some of these features if they wish to increase their price and appeal to a millennial market.
13. Millennials Are Drawn to Homes That Have Solar Panels and Other Eco-Friendly Features
Besides loving tech, millennials are also environmentally conscious. According to international research, 90% of young people are concerned about climate change and agree that humans are responsible for it.
Because of this concern, a high percentage of millennials are also willing to adjust their lifestyle to support the environment. Thanks to this desire to make a change for the better, millennials are attracted to features such as solar panels, solar geyser, and other eco-friendly home systems.
14. Dogs Are Driving Buying Decisions
Interestingly, a large number of millennials are buying homes not to start a family, but rather to provide space for their dog! One survey on reasons for home buying found that 33% of the participants surveyed were motivated in their home purchase by the desire to give their dog a yard.
This was also the leading motivating factor, topping marriage (25%) and the birth of a child (19%).
While these stats might sound crazy, it does add up that yard space for pets would be a dominating factor for millennial buyers. Millennials tend to have strong bonds with their animals and are concerned about providing them with the best care.
Renting with dogs or other pets can be difficult at best, as many places are not pet-friendly.
Coupled together, the difficulty of renting with pets, and the desire to provide them with good conditions, explains why pet's needs are such a large motivating factor in millennial home buying decisions.
Understanding the millennial home buying market will be an invaluable insight for both real estate agents and homeowners looking to sell. As time goes on more and more millennials will reach the point where they are in the financial position to purchase a property.
Now that you are equipped with these facts and insights into the mindset and needs of millennials buying homes, you will have the advantage when marketing houses to generation Y - the largest generation that America has yet seen.
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