Recently Google reported several positive house hunting trends including the news that Millennials are setting their sights on homeownership more so than other age groups. Now that the economy is recovering, younger buyers are more confident about their chances of achieving the American dream of homeownership. Below, Homes.com presents four noteworthy shifts that this generation considers along their path to owning a home.
1. Millennials’ growing interest could improve the demand. While the market was in recovery mode, Millennials were hunkering down in their parents’ basement or shacking up with roommates and likely paying down their student loans or saving for a down payment. According to a study by The Demand Institute*, 75 percent of Millennials believe that owning a home is an important long-term goal and now that economic conditions have improved, these younger buyers are planning their next step toward that goal.
While Google’s consumer survey revealed that Millennials are twice as likely as 35-54 year olds to buy in the next year, market barriers like low inventory, credit restrictions, increased property values and student debt may threaten their ability to own.
Millennials are one of the largest generations in history, second only to Baby Boomers, but make up the largest share of recent buyers at 31 percent. They also comprise the majority of first-time buyers at 76 percent (NAR Home Buyer and Seller Generational Trends report). That said, their presence and interest in purchasing a home has the potential to stir up the demand and improve the market further.
2. Younger buyers comprise the majority of online real estate searches. With growing optimism, half of Millennials visited real estate websites in July, a 30 percent leap from last summer (Google Consumer Survey). Further, 36 percent visited real estate sites or their apps from a mobile device, an 81 percent increase from the previous year (comScore Media-Metrix data). To top it all off, 26 percent of younger buyers found the home they ultimately purchased via a mobile device (2014 NAR Home Buyer and Seller Generational Trends report).
NAR’s report also revealed that all home buyers, regardless of age, typically began the home-buying process by searching for properties online and then contacting a real estate agent. Millennials though, are more likely to research information about the home buying process before contacting an agent.
Millennials are being prudent and take more time than other age groups to research their next home, as 83 percent reported that formally began their search more than six months in advance of the purchase (Google Consumer Survey).
As for what Millennials value in a home, Google’s house hunting trends revealed that Millennials have different priorities and care more about the neighborhood, school districts and high-speed, Internet-ready homes. To that end, 48 percent are headed to the ’burbs in search of enough growing room for their families-to-be and a short drive to grocery and retail stores and restaurants (The Demand Institute).
3. Millennials prefer to work with genuine brands. Millennials are not only a prudent group, but tend to be skeptical of brands and advertising. They don’t trust advertising, and in fact, 67 percent reported that they have never clicked on a sponsored story on social media. Conversely, 98 percent are more likely to engage with a friend’s post than that of a brand’s. Ninety-five reported that their friends are the most credible source of information (Shoutlet). Because of this, real estate pros should market with them, not to them. This group appreciates authenticity and transparency, so consider building relationships with Millennials so they’ll feel empowered to share stories about your real estate services with their friends.
4. Marketing Tactics to Connect with Millennials. In summary, let’s explore some tactics that can connect you with this uber-tech-savvy group of younger buyers.
– They’re searching for real estate information from their mobile device. Make sure your website is mobile-friendly with responsive design technology, which keeps your web presence consistent across all devices.
– Millennials spend an average 3.2 hours a day on social media (Statista). Stay active on these channels and share helpful content that prompts them to engage with you and become an advocate.
– Register your business on local business directories and review sites so you can be found online. Ask for testimonials from clients and post them here to substantiate your credibility and capture word-of-mouth referrals.
– Provide valuable resources to educate Millennials on the home-buying process, such as new home buyer guides and mortgage checklists from Homes.com’s consumer resources library. Download these materials for free and add your branding to stay top of mind.
*Millennials and Their Homes: Still Seeking the American Dream, The Demand Institute