Knowing your buyer is an essential part of executing a successful property transaction – and every seller should expect their agent to have an intimate knowledge of their target market.
With GenZ and Millennials either buying their first homes or upgrading to a second, they have become an important part of the market.
While most media commentaries would have you believe these demographics have all but given up hope of owning a home, a new survey exposes that as a myth.
It says 60% of GenZ and Millennials believe home ownership is attainable, but only a fifth (19%) think it’s a good time to buy.
Some 59% say they’re waiting for the market to improve – that is, for mortgage costs to fall in response to an interest rate cut from the Federal Reserve.
Their reasoning is sound. Mortgage costs have remained stuck at around 6.75% and the value of homes continues to increase. The National Association of Realtors recently reported existing homes achieved record-high price average of $435,300 – a 32% increase in five years.
The new data on Genz and Millennials features in the fifth annual NextGen Homebuyer Report, published by FirstHome IQ in partnership with National MI.
Interestingly, GenZ and Millennials’ trust in banks has dropped from 61.5% to 40% in the past 12 months, and YouTube and ChatGPT are cited as the most trusted sources of information.
Only 19.5% of respondents trust loan officers. Some 40% will turn to an agent first to seek advice on buying a home even if only 33% totally trust them.
If you’re targeting a younger demographic to purchase your home, consider hiring an agent with a strong social media presence.
It’s important your home is being marketed on the platforms that hold the attention of GenZ and Millennials.
These younger buyers are also getting more creative about how they intend to purchase given high interest rates and strong prices. Here are some key numbers:
42%: Buying a fixer-upper.
21%: Co-buying with friends or family
18.6%: Renting out part of their home.
47%: Moving to a lower-cost area.
But do they have cash? After all, if you want to sell your home, you need to know whether your target segment can afford the price.
Fewer young buyers (26%) say they are experiencing financial stress, down from 33% in 2024. Two-third say they feel some stress, citing the cost of living and unexpected bills as the main worries.
The survey shows young buyers don’t just want to be given a bunch of homes to walk through but seek financial clarity so they can make their decisions with confidence. This lack of knowledge appears to manifest itself as an additional factor for delaying a purchasing decision.