One of the largest generations in history is about to move into its prime spending years. Ninety-two million Americans between the ages of 15 and 35 born between 1980 and 2000, Millennials as they are called, are poised to reshape the economy. Their unique experiences and approach to life will change the ways we buy and sell, forcing companies to examine how they do business for decades to come. What do real estate professionals need to do to capture Millennial home buyers as clients and work with them successfully?
1. Be Social and Connected. If you are not using some form of social media, then it is likely you will not attract Millennials. According to the National Association of Realtors (NAR) report published in November 2014, 92 percent of home buyers used the Internet at some point during their home buying process. These same people are texting (44 percent), and on social media (38 percent). Brief, frequent, and efficient interactions are the communication norm for Millennials. Get an online presence and stay connected.
2. Understand They Have Less Money to Spend. Salaries are lower for Millennials and they are saddled with debt. Many who are making good salaries are paying off big student loans. The average student loan debt for 25 year olds was $20,926 in 2013, according to Goldman Sachs. And Millennials have less in savings. Yet, 93 percent of renters between 18–35 years of age want to buy a home someday. Helping them prepare for a home purchase may be one of the biggest services a real estate professional can provide.
3. Be Aware of Their Different Priorities. The Baby Boomers were the first to seek work and family balance in the workplace. Millennials see workplace flexibility as critical to quality of life. They are waiting to marry, start families, and buy a home. Yet, 70 percent say they want to get married and 74 percent want to have children. They think of access, not ownership, which drives their thoughts about everything from apps to cars to houses. It is predicted that in 25 years, car sharing will replace car ownership. Home ownership is part of the journey, not the destination.
4. Be Environmentally Aware. Understand that Millennials view the environment differently from Baby Boomers or Gen-Xers. It is more of a value to be incorporated into everything rather than its own, isolated discipline, explains David Weinberger, Next New Deal blogger. “We are concerned with economic growth, job creation, enhancing public health, bolstering educational achievement, and national security and diplomacy. Young people recognize that each of these concerns is inextricably tied to the environment and see environmental health and protection as a means to arriving at any of these outcomes.” Millennials seek a holistic approach to environmentalism that includes what they drive and where they live.
5. Recognize Multi-Generational Households. Despite all the issues facing Millennials that would appear to keep them from buying that first home, the next 10 years actually forecast a promising 24 million households from this age group. And many of them will be multi-generational households eventually. Many Millennials had to move in with their parents during or after college. In return, they are preparing to take care of aging adults. These concerns will drive their home purchases.
6. Realize They Need and Want Your Expertise. In spite of an air of confidence by Millennials, there is an inner insecurity in understanding the process of real estate. Experienced agents know the difference between the flow chart and how things really work. There is no program or app for this knowledge — there is just you.
Working with Millennial home buyers does not have to be intimidating. You already have the skills you need to be successful. Listen and learn.