What Millennials Have Learned From Watching Their Parents Real Estate Mistakes

Millennials Are Dominating The Market

Today, more first-time buyers are millennials than ever before. Millennials are now essentially dominating the market, playing a very important role in real estate sales.

The biggest reason for this? The majority of them are of the age where they are beginning to form households, getting married, and having children. This is the group who are in their late 20s to late 30s.

Jobs And Attitude

Another reason millennials are taking over the market is that the economy is stronger and better jobs are available for them. And because they’ve formed households, they often have two incomes coming in, which means that they can buy bigger first homes than their parents did.

Millennials have watched some of the financial mistakes their parents have made, therefore, they have a different attitude about things. They’re more conservative financially. They watched the housing market crash when, instead of spending the traditional 30% of income on housing, people were spending 60% or more on housing. Millennials aren’t making the mistake of being fooled into thinking that housing prices will increase exponentially and indefinitely.

Space And Location

Millennials today, particularly those with children, are looking for more space and better locations. Of course, the definition of a great location depends entirely on the millennial or the millennial couple. Some could be looking for a country club setting. Others may want a beach-front property. Others are looking to be in the middle of the woods or the middle of downtown. Millennials tend to be more adventurous and individualistic as far as wanting to explore different locations.

One of the main focuses for millennials with children is a location near good schools and activities that their children will be able to get involved in.

One final point on locations: millennials have started job-hopping a lot. This could be blamed on their adventurous spirit. But what it means for the real estate market is that they end up buying more homes and often in many different places.

Switching Gears To The Older Generation

Now, it’s time to talk about the older generation. A general rule of thumb goes that the older generation—once the kids have left the nest—are usually looking to downsize. They may own a four- or five-bedroom house with space that they don’t really need.

Typically, a sizable amount of equity has built up in the home. It’s appealing to think about capturing the equity and reducing the cost of living by getting a smaller place. But a new trend called “aging in place” appeals to about 83% of older homeowners who are deciding they want to stay in the home they have. There is a consistency with that that’s comforting to a lot of people.

However, the home they currently live in might not be senior-citizen friendly; it may have lots of stairs or bathrooms that don’t accommodate their needs, which could lead them in the trap of spending more money to renovate their home. Aging in place also means that seniors don’t have access to the amenities that are available in a retirement community. Nonetheless, that’s the choice many seniors are making.

If you’d like to learn more about buying a home or selling your home, connect with Terry at Keller Williams!