Friday, February 14, 2014
Where are the Millennial Homebuyers?
Millennials refer to those born between 1980 and 2000, and they make up the second largest segment of homebuyers according to a study on generational housing trends conducted by the National Association of Realtors. So where have they gone? The weight of student loans has significantly affected the rate at which Millennials are making home purchases, with many college graduates struggling to keep up with the hefty payments after graduation. The tough job market and current economic conditions are also contributing factors to Millennials renting homes rather than purchasing.
The good news, however, is that consumer confidence about the potential to qualify for a mortgage is increasing, meaning that this segment is moving closer to becoming first-time homebuyers. According to Fannie Mae’s National Housing Survey results, an all-time high of 52% of consumers now view mortgage credit as more accessible. Not all Millennials are worried about qualifying for mortgages, but simply hold generational differences in home preferences and sales delivery.
When determining what options to present to potential millennial homebuyers, there are some important things to keep in mind. Many young homebuyers prefer an open floor plan over a floor plan where every room is sectioned off from the rest of the home. A low-maintenance home is also highly desirable by Millennials, who grew up with chores and watched their parents spend countless hours on home maintenance and repairs. With the increasing popularity of environmental responsibility, young people are attracted to homes that are energy efficient, as well as technologically advanced.
Knowing how to market to Millennials is also vital in capturing their attention, interest, and desire in purchasing a home. Social media channels are used most heavily buy this segment of young people, and realtors are having success with sites such as Instagram, which consists only of image sharing. Some tips on how to sell a home on Instagram can be found here. Influenced by the speed and ease of using technology and the internet, Millennials also want their home purchases to have the same characteristics.