MILLENNIAL HOMEBUYERS SWING FOR THE FENCES
Next up to bat against the homebuying vendetta: millennial homebuyers.
We all know what a millennial is, but let’s check out their stats:
• A millennial is a person born between 1981 and 1996.
• They’re also known as Generation Y.
• They’re educated, technologically savvy, civic-oriented, and huge fans of craft beer.
• And, in 2019, millennials will be the largest living generation in the U.S. at 73 million people, surpassing the baby boomers by one million. That’s one-fourth of the entire United States population.
That’s a lot of homebuyers.
Unfortunately, the hesitance to buy homes weighs heavy on this group and it’s not because of avocado toast. Things like student and personal debt, housing affordability issues, lack of savings, oh my, are creating mountainous roadblocks for millennial homebuyers.
Millennials carry an average debt of $42,000 and most of them have no idea when, or if, they’ll be able to pay it off. Affordable housing is slim to none. Lack of savings is caused by things including stagnant wages, a rise in bills, and, to come full-circle, crippling debt.
As homebuilders, how do you reach the nation’s largest generation with the most potential, all while they’re drenched in homebuying apprehension?
There are a few things we already know. First off, millennials are well educated, around 40% holding a bachelor’s degree or higher. Secondly, while they’re the next largest generation, they’re also the most connected with more than 85% of millennials having a social media presence. Thirdly, millennials are waiting longer to buy homes by living with their parents. Rising housing prices are outpacing wages, making the transition more difficult.
• Location – When it comes to millennials, searching or relocating for a secure job and better quality of life isn’t unheard of. While millennials love city life, they appreciate a small-town atmosphere and are more likely to put down roots in less-traditional markets with plentiful jobs. Where the job growth goes, the millennial will follow.
• Online Marketing – Let’s face it; millennials love social media. Market to these buyers through their comfort zone. Virtual reality home tours, appealing high-quality imagery, and social media feeds allow millennials to shop at their convenience, while analytics allow you to track their habits.
• Affordability – The TNAH released their New American Home for 2019; a 9,000 square foot home with five bedrooms overlooking the Las Vegas strip. Homes like these may pique the interest of more affluent or move-up buyers, but to encourage millennials to move out of their parent’s homes, affordable starter homes could be the winning home run.