Millennials and the Market
Updated: May 18
Millennials have left a lasting impression on the housing market, and more changes may be on the way as this next generation of home buyers enters the fray. Focusing on the positive impacts created by Millennials is key to keeping that evolution in perspective.
FACT: Nearly half of Millennials (now between the ages of 20 and 37) live in suburbs.
FACT: New Home Inventory is low… very low. However, builders are trying to find a way to increase construction of new, entry-level homes to accommodate the growing need. This is good news as would-be buyers have been frustrated in their search for a home that meets their needs, and their budget.
FACT: A large portion of Millennials slightly less than half are already purchasing their second or third homes. (Wow!)
First, communication is key.
Millennials are well connected and have a large network. Their neighbor, relative or friend of a friend likely knows (or is) a real estate agent.
However, they value key components and are not as likely to simply accept a referral without doing their research.
• Be social and have your contact information easily accessible online. Have you googled yourself lately? Do your contact information, website and social media platforms quickly pop up?
• Do you have a professional headshot? Monitor your online image and provide content that speaks to the clients you want to attract.
• Be ready to text, email, tweet, FaceTime and message. This is not your momma's real estate market, and we must evolve with the next generation of clients.
• Tech up! Make the process convenient for them with slick apps and technology they can really submerse themselves in.
They are much more apt to preview a virtual tour on their mobile device than schlep across town and fight traffic. Next, be an expert in the process Advise them on credit score and finances and be knowledgeable about the process. For example, a credit score is a numerical representation of your credit report. FICO scores range from 300 to 850, and the higher your score, the better; It’s best to use 30% or less of your total available credit. Remind your clients not to open new credit cards. A new credit card could put a prospect in danger of not qualifying for a home loan in their desired price range – or at the very least – not getting the best rate possible. Besides the mortgage loan and down payment – homebuyers should also set aside money for unexpected repairs and costs. Before they start looking (this means online, too!) buying prospects will want to consult with a mortgage lender. A strong Realtor/lender partnership will only make the transaction more successful and the client experience more pleasant. We take time to praise each real estate agent we partner with, and offer accolades and positive reviews.
"Digital advances have transformed how real estate is done," says Kim Howard, a real estate agent and co-founder of Howard Homes Chicago. "Twenty years ago, real estate agents were valued for information. Now, the true value of a real estate agent is through their negotiation skills, relationships with other brokers, and their ability to keep up with the times with marketing strategies and processes."
The economic recovery over the past decade has been good for many Americans, and one of the effects of this is a surge in home buying among Millennials.
"There's been an influx of millennial home buyers as older Millennials have had some time to grow in their careers and pay off student loan debt," says Stuart Eisenberg, national director of real estate and construction practice for accounting firm BDO USA. Younger Millennials, meanwhile, more often rent as they begin their careers, but according to Eisenberg, the generational shift in home buying is just getting underway.
Millennials have left a lasting impression on the housing market, and more changes may be on the way as this next generation of home buyers enters the fray. Focusing on the positive impacts created by Millennials is key to keeping that evolution in perspective. An emphasis on technology, for example, may result in a streamlined, more efficient home buying process. And more Millennials moving to the suburbs could help balance out the effects of rising housing prices in urban areas.
"The market will adapt and go through changes as it always does," says Kim Howard, "and that just means a different market, not necessarily a bad one."
To get personalized help on your home buying journey, contact Southern Tradition Real Estate today at (479) 365-2585 or stop by our office at 4700 S. Thompson Street, Suite B-101 Springdale, AR