There is a time for everything, and some things need more time, buying a home, for instance. Even though experienced realtors like Ray Brown would say, “The best time to buy a home is always five years ago,” Millennials think otherwise.
A generation that has been analyzed like no other, the millennial thinking processes have significant economic consequence today, being the main income-earning group in society. Even more, being the first generation to grow up with Internet and smartphones, Millennials have intrigued analysts with their unique characteristics, and still do.
As they have done in everything else, Millennials have not followed the norm in buying their first homes. According to Pew Research, even as recent as 2016, 15% of Millennials in the ages 25-35, were living in their parental homes. And this was when they were still struggling to overcome the financial setback of the 2008 recession and their student loans. But now, things appear to be changing. According to chief economist of Freddie Mac, Sam Khater, since about two or three years ago, millennial incomes have been rising. And with more money at their disposal, the way forward in life is taking a more definite turn. While 66.1% of Millennials are ready to buy their first homes in the next five years, they have begun to associate the American Dream, with home ownership, in increasing numbers. The decision to be homeowners have been propelled also by the fact that rents are increasing in a market which once favored more renting than buying. Furthermore, more Millennials are getting married and starting families. This has brought forth the desire for stability and a sense of ownership that is absent in a rental situation. A recent real estate survey by the global market research company, Toluna Research, showed that 23% of Millennials surveyed were convinced they should buy a house because of the rising costs of renting. And, as with many other things, they are leapfrogging into situations, and doing it the millennial way, which is generally, a deviation from the norm. In home buying, they appear to want to make up for lost time, and are bypassing their “entry level” home, and are taking on larger, pricier, houses.
A generation that checks multiple online sites before buying even the simplest of items, there will be long hours of extensive research into all aspects of buying and owning a home, before even contacting a realtor. Unlike earlier generations, Millennials do not approach realtors for information regarding houses or the market. They have all the information they need at their fingertips, at the press of their smartphone button. Their need of realtors is different, and the shift of perspective has been a challenge to the real estate profession. For instance, a 9-5 day, and “getting back to you tomorrow” does not exist in the Millennial world They are seamlessly connected on Internet 24/7, and the expect immediate answers. Realtors, if they want business, need to respond immediately too, whether it is 11 PM or 6AM. And, there is no way to deceive with information, like earlier, for Millennials will always find out for themselves. And when the trust is broken, Millennials will abandon the relationship and seek a more authentic connection they can trust.
Even as they approach home-buyers armed with all kinds of information, Millennials differ from earlier generations in a very decisive way – they do not want to be bothered with re-modeling. They want to move into their dream home which is already available in the way they want. In other words, they seek great house and land packages.
High on the list of priorities is having a “smart home” with advanced technology. Millennials would rather spend time hanging out with friends or travelling to discover the world, rather than getting stuck with fixing up a house. As real estate expert, Steve Gold, says, “Our generation is the most digitally engaged, therefore, we want wireless thermostats, smart security systems, wireless speakers, Wi-Fi cooking ranges, smart locks, and eco-friendly automated light and shade controls.” Further, as the National Association of Home Builders discovered, the eco-conscious Millennials seek energy-efficient houses and are inclined toward renewable energy like solar power, and many are willing to upgrade by spending out of pocket.
Millennials, being health-conscious, prefer to let go of carpeted floors that are constantly collecting dust,l and seek hardwood floors in their homes, where they would add color with area rugs. According to real estate analysts, 82% of millennial home buyers are looking for hardwood floor options.
In another break with the past, the formal appearance of houses preferred by earlier generations does not match the perspective or the informal lifestyle of Millennials, who consider the kitchen the “hangout center” of the home. And as they see it, the kitchen should flow naturally into other rooms for effortless entertaining and cozier living. Furthermore, with over 30 million people working from home at least once a week, a number expected to rise by 63% in the next five years, the millennial home buying requires an attractive workspace, which was not a feature of older houses.
So, the housing market is frantically trying to satisfy the millennial requirements, focused on selling quality houses with high-tech facilities to a generation that values the conveniences of a tech age, and the luxury of enjoying quality time at home. As business magnate, Warren Buffet, said, “Price is what you pay. Value is what you get.”