People are getting more and more tech savvy, and millennials are at the forefront of this trend. For example, their workplace demands and expectations are currently overhauling the way work gets done in offices everywhere, and their unique skills and values reflect into their expectations about real estate.
On the flip side, millennials are also considered more unpredictable. As compared to the previous generations — who were more drawn to a stable career, security, and formal structures — millennials are perceived as averse to formal structures, and less driven by security when planning their careers or in their spending and savings patterns.
The majority of these perceptions are just myths. These opinions follow millennials into the real estate space, creating misconceptions about their interest in homeownership and even their ability to enter the market.
Below are six of these myths, and the reasons why they should be considered just that and nothing more.
Myth #1: Millennials are Resistant to Settling Down
One of the common myths about millennials is that they don’t want to settle down. This isn’t quite true. According to the RISMedia, quoting National Association of Realtors data, the median age for first time homebuyers in 2015 was 31, not much different from what it was in the 1970s, when the average was 30.6 years old. In fact, over a span of 40 years, the age at which people begin purchasing houses has more or less remained unchanged.
And since the oldest millennials are currently in their early 30s, this means that a significant number still remain well below that average age of entry into the homebuying market.
Myth #2: Cultural Trends Have Kept Millennials from Homeownership
A study by Fannie Mae, from August, 2016, blames the 2008 Great Recession for the small number of millennials becoming homeowners.
During this period, the number of homes owned by people aged 25-34 years was 10% higher than it is today. Rather than any cultural trends, it’s more likely that the economic downturn and ongoing financial uncertainties are what have caused millennials to delay their entry into the real estate market.
Myth #3: Marketing to Millennials is Fundamentally Different than to Other Groups
The limited participation of millennials in real estate has resulted in a common belief that the real estate marketing required to reach this group must be different than that of previous generations.
This isn’t necessarily true. As with any successful marketing plan, correctly identifying the demographic is the first step. Remember that two-thirds of millennials have yet to reach the average age of first time buyers, which is around 30-31.
Nurturing potential homebuyers on the long term will be more effective with millennials, because it will resonate with them when they reach the house buying age, a few years from now. And that long-term marketing will pay off: at that time, millennials are predicted to impact the real estate market significantly. Make sure you cater to their expectations with a well-designed, responsive real estate website.
Myth #4: Millennials Are Not Interested in Buying Homes
The limited comparative participation of millennials in the real estate market has resulted in the view that they’re not interested and don’t plan to buy houses. This perception is a myth.
Fannie Mae reports that 90 percent of people between the ages of 18-39 say they want to buy a home at some point — it just might take a while.
Myth #5: Student Loans Deter Millennials from Buying
While the rising volume of student debt (up 50 percent over the past decade) has been associated with decreased homeownership among millennials, there’s no proof that this is the case.
In fact, a 2015 study by TransUnion, showed only a 3 percent difference among real estate buyers with students loans and those without.
Myth #6: Homeownership is Lowest among Millennials
The situation is that homeownership is low among all age groups, and not just millennials, following the 2008 Great Recession. Nerdwallet quotes data from the National Association of Realtors to show that ownership in general has declined across all age groups.
by Caylin White
