What Millennial Homeowners Are Looking For in 2019
According to FortuneBuilder’ article, Millennial Real Estate Trends 2019, home builder’s must provide atleast one of the following traits:
- Big kitchens: 46 percent of millennials say they want a luxury kitchen.
- Open floor plans: Millennials want more open floor plans, even if that means a lesser number of rooms. Why? They want rooms that flow into other rooms to make it easier to entertain guests.
- Updated kitchen and bath: Updating a kitchen or bathroom after moving into a home is difficult for millennials after making a down payment, which is why this generation wants to find properties that have been previously upgraded.
- Home offices: Working from home has become a popular trend in the millennial generation.
- Energy efficient appliances: 47 percent of millennials say they want solar panels and efficient energy storage as “going green” and sustainability are high on the list of their priorities.
- New technology: Of Americans who use smart home products (i.e. smart TVs, remote security systems, etc), 43 percent are millennials.
- Ideal location: Millennials want a home that is close to work so they don’t have to waste money on gas.
Millennials Overtake Generation X
According to Realtor.com, “Millennials now represent the largest dollar volume by any age group. In November 2018, Millennials overtook Generation X as having the largest share of new loans by dollar volume, with a share of 42%. This means Millennials are willing to take on larger mortgages than any other generation.” This also means they have the money and are willing to spend on materials and living spaces that they find are “affordable”.
We created a 2018 case study for our local client, Di Loreto Homes, and within a 12 month period they had over 55,500 visitors to their IDApro.cloud platform on either their website or sales center kiosk, and over 28,000 of those visitors were Millennials. Di Loreto Homes ended up selling their entire 114 lot community for a median home selling price of $434,600, and averaged over $25,000 in floor plan option sales per lot totaling over $2.746 million. This shows that given the right tools, than Millennials are willing to pay for things that they find “affordable” or “necessary”.
Integrate our Interactive Interior Materials Options App
What tools are you using to give buyers the peace of mind knowing they are spending their money wisely? For example, our IDApro.cloud software houses 2 main interactive applications – Interactive Floor Plan and Interactive Site Plan. Our IFP app allows buyers to interactively choose their floor plan, add structural options and save their design. Go a step further and integrate our Interactive Interior Materials Options application directly into your IDApro.cloud platform to allow buyers to interactively choose between kitchen cabinets, countertops, flooring, appliances and more! Allowing buyers to become more hands-on in the buying process will give them the feeling of accomplishment and overall satisfaction with the end product – their new home!
Interactive Floor Plan
Interactive Material Options
“Millennials are getting older, with better jobs and deeper pockets”
In the same Realtor.com article mentioned above, Director of Economic Research, Javier Vivas, said, “Millennials are getting older, with better jobs and deeper pockets, allowing them to expand their collective purchase power. The stereotype that Millennials primarily choose to buy homes and live in large metro areas isn’t the reality,” Vivas said. “Results show Millennials’ expansion is more heavily conditioned by affordability than in prior years, so their eyes are set on less traditional secondary markets where homes and jobs are now available and plentiful.”
INseARCH is based out of Reno, NV, so we definitely have a great understanding of what Mr. Vivas is talking about. We are that “less traditional secondary market where homes and jobs are now available and plentiful.” Since 2015, we have seen huge growth in our area because of massive corporations, such as Google, Panasonic, and Tesla Gigafactory, opening up in the outskirts of town which require thousands of workers. According to Data USA, between 2015 and 2016 the population of Reno, NV grew from 234,161 to 237,121 with a median age of 35, and its median household income grew from $47,012 to $48,815, a 3.84% increase. At the same time, property value grew from $210,700 in 2015 to $235,800 in 2016.
Jump to today, over 3 years later…
Now jump ahead to today, and according to Chase International, Reno-Sparks median age is still 35 years old and our housing market’s median home sold price was around $340,000 in Dec 2018. In less than 5 years there has been a $100K increase in the median sold price! How are builders selling to a market that is most worried about spending money?!
These stats just represent a small sample size of the United States, in regards to Millennials, but what we can take away is Millennials are becoming the #1 homebuyer in the US, so understanding what they are looking for in terms of not only living space, but what’s “affordable” will be huge for your success.
Home Builders Must Make Buying Achievable
The home building industry is going through a huge technological change when it comes to selling homes, but that’s not all. The cost to build and acquire materials is increasing, while home buyers are wanting “more affordable” and lower prices. How do home builders deal with this dilemma?
First, builders must focus on providing tools that allows buyers to understand the buying process instead of just “going through the process.” Second, not only HOW homes are being sold is changing, but WHO’s buying is going through an overhaul, too.
Noelle Tarabulski published a great article in Colorado Builder Magazine named Mile-High Millennial. In this article she stated, “Builders need to provide great product at affordable prices to even be thought of in the mind of most millennials. Builders also need to offer buyer education and marketing that explains the home-buying process in a way that makes it achievable, not beyond the reach of most hard-working millennials.”