There really isn’t a formal age range for where the millennial starts and ends, however, most researchers and statisticians have the starting birth in the early 80’s and the ending birth around 2000. So, for the purposes of today’s article, if you’re 36 or younger, you’re a millennial (also called Generation Y).
Today there are 75.4 million millennials which make this classification the largest generational grouping in the country. So, it’s no surprise that millennials also make up the largest generational group of home buyers, generating over $514 billion in the housing market last year.
As a seller, should you cater to the millennial buyer?
Absolutely! Looking at the big picture, when you put your house on the market, the chances are very good that someone between 18 and 36 will be viewing your listing and they’ll probably be doing it from their smart phone. Millennials grew up during the explosion of the internet where they could find anything they wanted online in seconds. This bunch will be way more informed than any other generations in the country and trust me, if they do hours of research on a pair of shoes, just think what kind of time they’ll put into buying a home.
With this line of thought, its a great idea to keep this generation in mind if you do any upgrades to your home in order to sell. Think about installing “smart” features in your home like digital thermostats, home automation features, and surveillance cameras. Make all necessary repairs before you list your home. As the budget allows, consider upgrading your kitchen and baths.
Furthermore, because this is such an internet savvy crowd, you need to make sure that your Realtor provides a detailed listing for your home along with many, high quality photos.
Other Tips on How to Appeal to the Millennial Home Buyer
While we’re at it, let’s talk about other ways you can attract a millennial to your home….
Create a Open Floor Plan
We’ve found that Generation Y likes wide open spaces with less walls and sectioned off rooms. They prefer their rooms suitable for entertaining and versatile versus stuffy and closed up. We’ve all watched real estate shows on TV. How many times have you heard a 30 year old say, “I want a seperate formal dining room.”? It would be great if you have the funds, patience, and time to knock down a wall or two but if you don’t, rearrange your furnishings to make your space appear bigger and more functional.
Style and Millennial Charm
Many buyers in this crowd love clean lines, no carpet, sleek design, and neutral color walls with a pop of color here and there. For the kitchen, stainless steel appliances and granite are always on the wishlist. And, any brass looking light fixtures in the house has to be replaced immediately. As with any home that is going to be on the market, this is the time to de-clutter and minimize the decor. A good rule of thumb is less is always more.
Even the oldest in this generation isn’t that old and many of these buyers love to be able to walk to such things as entertainment, restaurants, shops, and parks. I do realize that if you’re home has a poor walkability score you can’t just uproot and place it somewhere else. However, if you’re home does have a great score, you should highlight this feature to the millennial buyer. What’s your walk score?
This huge group of potential buyers are much more eco-conscious than the generation that preceded them. If your home was constructed with environmental friendly building materials and utilizes energy efficient technology, this could only be a bonus for attracting the Gen Y buyer.
It’s totally understandable that you can’t do everything listed here. You should just be aware of the things that concern the largest purchasing group in the country.
Check out these facts from the National Association of Realtors and their Home Buyer and Seller Generation Trend Report 2017 concerning millennials and real estate.
Characteristics of the Millennial Home Buyer
- 66% of all first-time home buyers were millennials.
- At 34%, millennials are the largest generational group of home buyers in the country and have been for the last 4 years.
- 55% are interested in investing in real estate.
- 66% of this group were also first-time home buyers.
- An interesting trend is that they are evolving in their style of desired home and moving towards a more traditional home (for instance, a single family home in the suburbs).
- 66% of Generation Y’ers are married and nearly half have children under the age of 18 living with them.
- 13% were unmarried couples.
- The median age is 31.
- The median size of a home purchased was 1,800 square feet.
- The median home was built in 1984.
- Millennials choose to look for their home online (no surprise there).
- The typical time the millennial searched for a home was 10 weeks.
- This group was more likely to purchase a foreclosure.
- 92% of this group of buyers chose to use a Realtor with their purchase.
- 98% financed their home.
- The median household income was $82,000.
- 75% used money from their savings for their down payment.
- 46% of millenials had student debt with a median amount of $25,000.
- 56% utilized a conventional loan versus an FHA or VA loan.
- 85% say that purchasing a home was a good investment.
Characteristics of the Millennial Home Seller
- Millennials who were married made up 86% of home sellers last year.
- They stayed in their homes for an average of 6 years before selling.
- Gen Y’ers homes were on the market for a median time of 3 weeks before going under contract.
- They are more likely to offer incentives to sell their home.
- Millennials sold their home for a median amount of $20,100 more than they bought it for.
- 55% used the same real estate agent to buy and sell their home.
Millennials Are Changing the Real Estate Industry
When you throw 75 million home buyers into the real estate market (yearly) and toss in a little bit of technology and evolution, you will have an industry changing event. This is what we’ve been seeing with the last generation. It’s not a bad thing but those who choose not to grow with society will definitely be left behind.
– More than any other generational group, millennials consider home ownership as the American Dream.
– Most expect to buy a home in the next 3 to 5 years.
– 99% searched online for their home.
– 58% found their home on a smart phone or other mobile device.
– They demand professional online pictures of the home. 76% drove by a home based on an online listings. 64% viewed the a home in person after seeing an online ad.
– 92% purchased their home through a Realtor
– 48% buy new construction homes to avoid having to do repairs.
– They are least likely to identify their home as permanent and sell on average in 6 years. Millennials see their home as a “stepping stone” to the next one.
– Most prefer a large kitchen and open space for entertaining.
– 47% say they want energy efficient upgrades
– 75% say they want brand new appliances
– Most of Gen Y want a home office for either working at home or bringing work home.
– Bad cell reception or internet providers could be “dealbreakers”.
– 43% of the country who use smart home products are millennials.
– 65% say that convenience in getting to and from work is the most important factor in choosing a neighborhood.
Millennial buyers were a little late getting to the party but now they’re here and are dominating the real estate industry for the unforeseeable future. Is your home millennial-ready? For all of the Realtors out there – are you tech savvy? Time to get onboard!
Other Helpful Articles About Real Estate and Millennials:
Is Home Ownership a Reality or a Dream for Millennials? – Dan Barcelon
How Millennials Are Changing Real Estate Markets – Anita Clark
Tips for Millennial Home Buyers – Bill Gassett