Millennials are a force to be reckoned with. Born between the years 1980 to 1996, this generation grew up maximizing technology. They also have perspectives, behaviors, and expectations that distinguish them from other age groups. With them making up the largest portion of home buyers nowadays, it’s important to understand how they think.
Here’s what you need to know about the millennial homebuyer.
They see home ownership differently
Millennials have a slightly different idea about homeownership compared to previous generations. Baby boomers see homeownership more as a status symbol and a rite of passage. Meanwhile, millennials buy homes for practical reasons, especially when they’re about to start a family. Members of this generation do see themselves owning a home someday but will wait until the timing and conditions are right. This brings us to the next fact.
They tend to wait longer before buying a home
The cost of homeownership has risen significantly over the past few decades, with homes becoming 39% more expensive. That’s why millennials prefer to rent first before taking the plunge and buying a home. To save on rental expenses, they would share the space with roommates or their significant other.
Millennials choose to leave the perennial nest later on as well. According to Business Insider, around 21% of millennials in America delay homeownership and continue to live with their parents until they are able to save enough money.
They prefer smaller and more affordable homes
Forget large houses with multi-bedrooms, crown moldings, sprawling lawns, and an abundance of space. Millennials are more interested in smaller but modern and efficient houses that require less maintenance. For them, these elaborate homes (mostly built and owned by baby boomers) are too expensive to buy and maintain.
They are moving to commuter towns
Millennials are now moving away from expensive cities and settling in what is called “commuter towns” or suburbs. Here, the cost of living and homeownership is relatively cheaper. While the time to and from their jobs via public transport may take longer, millennials are willing to spend more time riding these in exchange for more affordable housing.
They are faced with financial challenges
Rising housing and living costs, high student loan debt, difficulty in saving money– these are just some of the financial challenges that most millennials have to deal with. According to the National Association of Realtors’ Home Buyer & Seller Generational Trends 2019 report, 42% of older millennials are in debt due to student loans. These financial hurdles are the reasons why this generation postpones their decision to buy a home.
They are tech-savvy
Among the adult generations, millennials are the most tech-savvy of the lot. They rely on technology, primarily the internet, for tasks ranging from shopping for clothes to ordering food online. Even looking around for real estate options is done online by this segment. In fact, around 81% of older millennial homebuyers found their home with a mobile app, based on the same 2019 NAR report.
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