What Investors Should Know about the Millennial Housing Market

According to the United States Census Bureau report of April 2021, millennials constitute the largest

age group with about 75.4 million out of the total US population of 331,449,281. Millennials are

those born between 1982 and 2000.

Presently they are between 21 and 39 years old. At this age, they constitute the most physically

active group of people. Since they are at the starting or middle point of their careers, they are

making life-changing decisions at this stage.

In the past, people saw millennials as a group of people that preferred renting homes instead of

buying them. That was due to several factors, including high student loans or delays in starting

families and having children. But after settling their debts, marrying, or having children, millennials

have become more concerned with homeownership.

It is evident as they make up the highest number of homeowners in the United States at 42%. The

statistic above is only from older millennials. With more financial stability from younger millennials,

this percentage will likely surge.

It is also essential to know that millennials constitute 50% of renters. That shows the effect this

group of people has on the housing market. As an investor, you need to understand the pattern and

trends of this set of people. Doing so will help you invest wisely and earn more returns . Below are

some things you should know about the millennial housing market.

1. Millennials want affordable houses close to work

Millennials prefer living close to their workplace. A survey shows that 74% of millennials will choose

a convenient neighborhood close to their workplace. About 44% of millennials believe that

transportation cost from home to their workplace is essential. However, 58% of millennials said that

the home's affordability is vital.

Among millennial homeowners, 47% prefer to own houses in suburban neighborhoods instead of

rural areas or cities.

2. Millennials love neighborhoods with strong communities

Millennials prefer to live in neighborhoods with a strong sense of community. They crave more

human interaction. Either as homebuyers or renters, millennials want locations with amenities,

entertainment hubs, dining, decent public spaces, etc. Crime rates and local school ratings are also

essential when millennials choose a neighborhood. That is because they buy homes intending to

reside there for a long time.

3. Communication with realtors

Surveys show that millennials prefer to communicate with real estate agents through direct

messages. They ask questions, express interest, and schedule appointments through messages.

Millennials will only make phone calls when the situation requires urgent attention.

According to the National Association of Realtors (NAR), real estate agents are now adapting to this

mode of communication. Surveys show that about 34% of agents chat with clients via instant

messaging. Though 94% of real estate agents still use email, 90% also communicate through text

messages.

4. Tech-oriented house hunting

Millennials are highly tech-oriented. As a result, technology plays a vital role in their house hunting.

An NRA survey shows that 99% of millennials go online to obtain general information about home

buying and the housing market. About 39% of millennials feel comfortable buying a home online.

Another 59% of millennials are somewhat okay with making an offer after a virtual tour of the

property.

According to the 2021 report by Zillow, over 80% of millennials will prefer a 3D virtual tour of the

home when house-hunting. Millennials want live streaming and videos instead of the usual pictures.

For that reason, agents now engage in virtual staging during the online marketing process.

5. Eco-friendly or sustainable environments

Millennials put much value in sustainability. They opt for environmentally conscious locations and

green homes. Millennials will prefer homes with features to lower energy consumption. In addition,

they do not mind the extra cost of installing solar devices in their home. Investors that want to

attract millennials should consider installing eco-friendly features on the property.

6. Smart homes

As millennials are tech-savvy, they are attracted to smart homes. They want to enjoy the ease of

accessing every system in their home through one device. Doing so will help them monitor the

property and control energy costs. If the home does not have smart features pre-installed, the

options for future upgrades should exist. As an investor, it would be best to consider these smart

homes.

7. High-income earners

Present millennials are high-income earners. They gain more income than the older generation

during their time. Although millennials may be first-time homebuyers, they can spend more on

luxury homes. Even as first-time buyers, surveys show that present millennials prefer deluxe homes.

Bottom line: What Investors Should Know about the Millennial Housing Market

Since millennials are currently the largest age group in the country, their choices affect the housing

market. Savvy investors need to adapt to the demands of millennials to create a sustainable

environment and incorporate technology during the home buying process.