Yesterday morning, I came across an article on the online version of the USA Today. It wasn’t in the real estate section or investment section. It wasn’t even an article. It was an advice column in the small business section. It answered a concern about how to market to younger generations and what works best with these post Baby Boomer generations. Should house sellers be aware of the changing market? You better believe it.
When the housing preferences of a new generation hit the real estate market, you can guarantee that it will have both a significant and lasting effect. Generation Y has now reached the age to buy their own homes.
Still think that they are too young? Current numbers show that the average age for the first time home buyer is 26. This is 3 years lower than Generation X and the Baby Boomers.
Who are these people? Generation X, born between 1965 and 1979, make up 20% of the total U.S. population. The subsequent generation, Generation Y (also known as the Millenials) is those born between 1980 and 1994. They make up 25% of the population. Combined, these people make up 45% of the U.S. independent consumer population. That means that a market is flooded with younger buyers.
What explains this demographic change? The younger generations live in the “urgency of now.” Don’t get me wrong—they are still putting off marriage and having children, but buying a home is viewed as an independent, professional investment. A good portion of them have had everything instantaneously provided for them while growing up. They demand equal treatment at work and tend to not stay long in one job before making a quick career advancement to another position. They show a pattern of wanting everything now---and that is including a home. Now, this generation is now entering the workforce in full force.
Where are they buying homes at? They are already showing signs of deviating from the Baby Boomer generation. According to the Urban Land Institute, the Millenials do not crave the suburban sprawl patterns of the Baby Boomers. They are showing signs of buying houses inside metropolitan areas. For this reason, houses that are closer to city centers are maintaining their value during the current down market and are expected to be the quickest to gain value once the market recovers (see related post).
They are still buying in the suburbs too. However, a lot are attracted to more mixed-use developments such as the Reston Town Center (Virginia). In developments like this, they were planned to resemble a sort of downtown in the suburbs that offered retail, office space, dining, transit and affordable housing all within a walking distance.
Christopher Leinberger, a fellow at the Brookings Institution, claim that Millennials are attracted to urban centers because of the high cost of gas and since they grew up on shows such as Sex in the City, Seinfeld and Friends which depicted urban life as trendy.
They are also different types of shoppers. The Millennials have spent all of their life with a computer and internet, which means they know how to research everything. They know how to look for a house, learn the closing process and keep alert to market changes. Therefore, without having real estate license, these potential buyers are already housing experts.
When listing the features of your house, make sure to mention the amenities of the community. What is the closest major highway? Is there a metro station nearby? What is a great coffee shop in the area? Are there some nice public parks nearby? What about retail within close proximity? Remember, the new generation likes mixed-use and transit oriented developments. If you don’t put this, they might think that this is just another house out in suburban sprawl, which will require lots of driving.
Pay attention to how your house looks online. Even if your house has been listed for months, take down that photo of your house in the snow and replace it with a fresh one. When online shoppers see this, they will automatically realize that it has been listed for months and think that something must be wrong with the house.
Also, you must take photos of rooms, backyard and features that will make the online virtual tour of your home look attractive. Are you photos free of clutter? Do they show depth?
Here are a few other suggestions to help with your online listing, whether you do it through and agent or a real estate blog that lists houses of For Sale By Owners (FSBO):
- Properly prepare you home for a photo shoot. Is your lawn mowed? Did you trim the bushes? Are your walls free of extra junk? Are those windows sparkling?
- The newer generation is a lot trendier than previous generations. Lots of these buyers will prefer hard wood floors since it seems metro. If you have any hardwood floors in your house, make sure you shine them up for some photos.
- Make sure furniture is placed in your photos. Potential buyers like to see how a room looks with furniture in it. Be careful not to place too much furniture since too much will make the rooms appear smaller. Try to get a friend or family member, who knows a lot about digital photography, to take some photos that will show space and emphasize depth.
- The kitchen is a huge selling point of a house. You want to capture the essence of this area. Take pictures of your kitchen appliances and cabinets. Again, try to get some good shots that emphasize depth. People love huge kitchens.
- The bathrooms are important to sellers as well. Make sure that chrome shines and the towels match the shower curtain. Make sure to include photos of the cabinets and fixtures.
- When taking photos of the bedrooms, make sure you open the closet doors and try to capture their size.
- When taking pictures of the living room, family room or den, make sure to include special features in your photos. This includes, built-in book shelves, vaulted ceilings, ceiling fans, fireplaces and bay windows.
- When taking pictures of your home’s outside, get a wide shot of the house and yard from different angles. Make sure to take photos of the garage and porches.
- Is your home part of a community? Go ahead and take those pictures of the pool, tennis courts and bike paths.
Remember to pay attention to how your house is viewed online. The new generation of buyers are doing their own homework, so if your home is not trendy enough for them, you might just lose out to a huge demographic who is ready to buy.