The Great Recession delayed many millennial's from being able to buy a home, but the
generation isn't locked out of property ownership the way it was a few years ago. The National Association of Realtors defines the millennial generation as people born between 1980 and 1998, and according to the 2019 NAR Home Buyer and Seller Generational Trends report, they make up 37% of all homebuyers in the U.S., the largest share of any generation. Over the past five years as millennial's have become a significant portion of U.S. home-buyers. they've also helped shape trends in location and home type preference, helped usher in technological advances and embraced new platforms that make a home purchase feel more user-friendly. Here are 10 ways millennial's are changing the home buying process.
Text communication is key.
The telephone was once the primary form of communication between real estate agents and their clients, but the younger generation that has grown up with internet and cellphones will likely prefer more text-based modes that make it easy to multitask. "A lot of my clients already work in tech, so their expectation is they're going to work with an agent that can at least keep up with them in terms of communication," says one of our agents with us at Maximum One®. They say millennial homebuyers prefer to text and email their agent more often than older generations, and it's reasonable to expect they'll be comfortable using real estate-related apps.
Research is a natural part of the process.
When When it comes to researching neighborhoods, checking out listings online and doing a deep dive into the fine print of a pending deal, millennial homebuyers are known for doing their homework. Representing buyers in a deal now goes particularly smoothly because the buyers read every disclosure and document sent to them and go ahead and ask questions beforehand - something you do not see very often from older buyers who feel experienced enough that they don't need to read into the details. "There's way more information today now, and (homebuyers) really, really should be paying attention," Maximum One® agent says.
The hub for advice is online.
While apps and online search tools are an integral part of the homebuying process for all consumers these days, millennial's are the first generation to grow up using technology broadly in everyday life. The familiarity with smartphones, social media and the internet make communication, finding out information and contacting professionals easier. Millennial's are also inclined to shop around for everything from real estate agents to mortgages to contractors. In HomeAdvisor's State of Home Spending report released in June 2019, the majority of millennial's, Generation X and baby boomers research home remodel project costs on the internet, but millennial's do so by the largest margin (77%).
Homeownership is focused on building wealth.
While purchasing a home involves plenty of hurdles for younger buyers, many of them are choosing to become homeowners because it helps them build wealth in the long term. "There is still interest in buying a house because I've got a job, I need a place to live, rent is expensive and I should put my money somewhere," Jayla says of the millennial homebuyer mindset. As they build equity in their home, they're in a better place to purchase a larger house in the future or use the profit of a sale for other investments.
Eyes are on garages and kitchens.
Luxurious features and finishes in a house are ideal, but millennial homebuyers are making their must-have lists a bit more realistic. In a survey of 1,000 Americans who plan to purchase a home in 2020 by real estate information company Clever, millennial's preferred home features focused on details that make life more convenient, especially as they start families. When asked which features are a requirement for their new home, millennial respondents placed a garage, large kitchen and space to grow into as their top three priorities. Details like hardwood flooring, a fireplace, pool and dedicated office space were among the lesser-desired details.
High home prices don't deter eager buyers.
Affordability is still an issue for many millennial's, especially among the younger members of the generation. But that doesn't mean millennial's are uninterested or afraid of purchasing a
home -- it's just a matter of the right timing, the right location and the right home. Between consistently rising home prices and a lack of inventory as homeowners choose to remain in their homes longer, the housing market remains extremely competitive, Millennial's are used to being aggressive to get into the college they want, the job they want, which primes them to make a stronger offer if they see a home they like.