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How to Make Millennial Home Buyers Love Your Home
In doing research about whether Millennial home buyers will buy more homes than Baby Boomers, I found an interesting article posted by Forbes. These numbers in the referenced paragraph below were a surprise to me, no doubt. I’m a believer in adapt to your circumstances and evolve with the times.
“Millennials will continue to make up the largest segment of buyers next year, accounting for 45% of mortgages, compared to 17% of Boomers and 37% of Gen Xers. While first-time buyers will struggle next year, older Millennial ‘move-up buyers’ will have more options in the mid-to upper-tier price point and will make up the majority of Millennials who close in 2019.
“Looking forward, 2020 is expected to be the peak Millennial home buying year with the largest cohort of Millennials turning 30 years old. Millennials are also likely to make up the largest share of home buyers for the next decade as their housing needs adjust over time.” — Danielle Hale, Chief Economist for Realtor.com.
So let me expand on how this can impact the Sacramento real estate market. In my experience, Millennial home buyers do not crave the big square footage or the monster-size lots. They do not want high maintenance yards or a large property to clean with 4 bathrooms. They value free time and energy-saving features. Since Millennial home buyers are the biggest segment buying homes, then sellers should focus on some energy-saving features and planting low maintenance yards.
These are important key features. When you begin to think about remodeling, think of modern and modest clean lines in design and simple colors, nothing too ornate.
Millennial home buyers carry about 46% debt due to student loans, so costs are a big factor and affordability is key. Definitely, it is important for sellers to understand the types of buyers and what those buyers value in a home. Adding on more footage may not be important to these buyers, as less is more. Before you enlarge your home footprint — unless you are staying for 20 years — perhaps rethink additions.
Adding on may not be a wise investment. Because Millennials have decided they would rather have more time than more house. I see how they live in less space and they collect a lot fewer belongings. To some, owning a car is no longer primary as Uber offers affordable alternatives for transportation.
Weintraub & Wallace’s superior technology and online marketing is well received by Millennials; they embrace technology and we comply. Strong internet service and signal will matter to these buyers. We also use 360-3D tours and high quality photos to reach these discriminating buyers. Sellers, make sure your windows sparkle and your home is kept in excellent condition as this could help deliver windfalls for you.
Today’s buyers value amenities in the neighborhood and efficiency such as public transportation and a sense of community. Further, having fitness centers close by, alongside animal friendly parks and recreation, could be important considerations, especially if you may plan to resell in the future.
Millennial buyers also love upgrades, they pretty much expect granite and crown molding in a home. When you are ready to upgrade, features like this could help you to sell quickly. Better understand Millennials when you are selling. Personally, this Sacramento Realtor is excited as housing trends evolve and builders will begin to adapt and build homes that appeal to this generation.
Will Millennials buy more homes than Baby Boomers? It appears the answer is Yes! Weintraub & Wallace Realtors are happy to help you better prepare your home to sell and appeal to the Millennial buyer generation; call us today and find out how. 916-233-6759
— JaCi Wallace
Millennials in Sacramento and the Minimum Wage
Mininum wage is not enough for a millennial to pay rent much less buy a home
For a state whose motto is Eureka, we Californians surely are dragging our feet to raise the minimum wage, which presently is $9.00 per hour. Eureka! those in the 18-to-34 age group known as millennials proclaim, I have a job; followed by: Uh, oh, too bad I don’t earn enough money to support myself. Businesses don’t want to pay them more because it cuts into profits, yet as businesses grow, typically sharing profits with employees is not part of that plan. And, if you suggest they could pay more to employees, corporations will accuse you of Socialism.
There is a lot of talk about how millennials can’t afford to pay back student loans, and how that huge mountain of debt is holding them back from buying a home. A more basic problem is most of them still live at home because they can’t afford to move out. C.A.R. reports the Pew Research Center says millennials are less likely to be living independently in 2015 than they were during the Great Depression.
U. S. Census Bureau data shows the millennial population has grown by 3 million since 2007 but the number of young adults living at home has increased. The national unemployment rate for this age group has dropped from 12.4 in 2010 to 7.7, which is a significant recovery, yet millennials still live at home.
Bottom line: Millennials can’t afford to pay rent and they certain can’t afford to buy a home. Which is particularly disturbing because in some parts of Sacramento today it cheaper to buy a starter home than it is to rent. We need buyers for the starter homes so move-up buyers can buy a bigger home. We can’t sell all of our starter homes to investors because that will dramatically affect the quality of our neighborhoods . . . oh, wait, we already did that with Blackstone.
I don’t need to tell you that times have changed. I left home when I was 15. Sure, somehow I managed to make it through high school, and I lived independently of my family my senior year, but that was 45 years ago. I could not wait to turn 18 and be completely independent. But I could also live on minimum wage, and I managed to buy my first home in my 20s. In retrospect, I was incredibly fortunate. It’s gone downhill today for millennials.
I met with tenants last week who presently attend Sac State and live in the Med Center. They can’t afford to rent a home through a property management company because they would have to show they earn 3 times the rental amount. Zillow says the average rent in Sacramento is $1,200. That would mean a tenant would have to earn $43,200 a year. Who makes that kind of money?
Most of the rentals in Sacramento are handled by property management companies because the rental laws are so incredibly complex that mom-and-pop operations fear they can’t properly handle rentals, and they would probably be right.
I bet you’re asking questions. I know many of us are, and you don’t have to be a Sacramento Realtor to ask these questions. Why can’t we raise the minimum wage to $15.00 an hour? If won’t fix everything but it’s a start. Moreover, why do we have to wait for state government to tell us to do the right thing?
