The 2018 housing market was a roller coaster ride of highs and lows. It started off strong with low mortgage rates and escalating home prices. But rising interest rates, a slowdown in new construction, and a short supply of existing homes weakened demand… for most. Despite the barriers, one generational group powered through: millennials.
Yep, it’s true. Though many think of millennials as the generation who can’t (or won’t) move out of their parents’ home, they’re dominating the housing market. In fact, according to the 2018 National Association of Realtors’ (NAR) Home Buyer and Seller Generation Trends study, millennials were the largest group of home buyers for the fifth consecutive year.
So, how can you take advantage of this millennial demand? Pay attention to their wants, needs, and behaviors. Here are four characteristics to expect from this group in 2019.
They want walkable neighborhoods and single-family homes. But they’ll be competing for both.
For years, millennials have shown a preference for living in the urban core. But recently, this trend has started to reverse. According to several studies, up to 66% of millennials now prefer the suburbs over big city living.
Though they want the space and single-family homes the suburbs provide, millennials don’t want to live in bedroom communities that lack access to basic amenities. Rather, they prefer a city-suburb hybrid, with “walking access to shopping and entertainment, good public school districts, and well-kept parks, jogging trails, and green space.”
The desire for walkable neighborhoods and single-family homes isn’t limited to millennials. Baby boomers, who made up the second largest share of the 2018 housing market, have similar preferences. This means that two very different generations may be competing for the same homes. So although it’s typical to focus on a primary buyer profile and stage a home accordingly, sellers and agents may need to change their tactics in 2019. Depending on the home, it may be best to find a way to appeal to both groups.
They are willing to buy fixer-uppers. And you can help them see what’s possible.
For some, the thought of walking into a home with issues—cosmetic or otherwise—is downright terrifying. But thanks to the growing popularity of home renovation shows like Property Brothers and Fixer Upper, millennials are more open to the idea.
These shows (as well as YouTube, Instagram, and home renovation blogs) have taught this generation what to look for in terms of red flags and how to do repairs themselves. Plus, they’re better able to envision what a house could look like once aesthetic things—like paint and wallpaper—are changed.
Keep this in mind as interest rates continue to rise throughout 2019. Your millennial clients can still get the home of their dreams—you may just have to help them see what’s possible.
They are well-researched. But they still need you.
Due to sites like Zillow and Trulia, millennials are coming into the housing market well-informed of the housing stock. But you can show your value as a real estate agent in other ways.
Let your millennial clients know which neighborhoods are up and coming and which are on a downward trend. Show them which properties are likely to gain value in the coming years. And give them guidance on home inspections and negotiations. You can also keep them informed on well-performing school districts or other amenities that may be of importance.
The role of a real estate agent may be changing, but if you’re willing to adapt, you can continue to be a valuable resource—even for the most internet-savvy clients.
They’re on social media. And you should be too.
Social media is huge among the millennial generation. In fact, a recent study revealed “a majority of millennials rely on [social media] influencers to make purchasing decisions—and a whopping 80% said they’d consider hiring one as a real estate agent.”
Bottom line—you should be on social media if you want to reach this audience. Need some ideas? Create an Instagram account and showcase homes on your feed. Use Facebook Stories, Instagram Stories, and Snapchat for home walk-throughs. Post about happenings in and around your community on Facebook. Or create a blog and share home-buying tips.
Social media is a beast, and it may take a little (or a lot) of research to figure out what works best. But the payoff will be worth it.
Key take-away: Millennials are the group to watch.
In 2019, millennials are projected to make up 45% of the market in terms of number of mortgages. Capitalizing on this demand is a no-brainer.
The four characteristics listed here will get you started. And with regular research you’re sure to see success with this generation.
Do you have experience working with millennials? If so, share your insights in the comments!