According to the National Association of REALTORS ® (NAR) 2021 report on home buyers and sellers generational trends, Millennials are continuing to buy homes in record numbers.
The report states that of all the home-buying age groups, Millennials make up the largest share at 37 percent: Older Millennials born between 1980 to 1989, are at 23 percent while the Younger Millennials born between 1990 to 1998 are at 14 percent of the share of home buyers. In fact, this generation has been the largest share of home buyers since 2014. Of Younger Millennials and Older Millennials who bought homes, 82 percent and 48 percent of them were first-time homebuyers respectively. That's more than other age groups.
Unsurprisingly, Older Millennials had the highest percentage of married couples (69 percent) buying homes. Meanwhile, Younger Millennials had the highest share of unmarried couples (20 percent) buying homes. The oldest group was also the most educated age group, with 89 percent holding at least an associate’s degree—followed by Younger Millennials. Finally, 28 percent of Younger Millennials moved directly from a family member’s home before buying their first home.
There are various factors why millennials are on a buying spree. A report that could possibly explain this trend done by Pew Research shows that the income of millennial households is two to four times higher than that of other age groups. Interestingly enough, this generation is more likely than other buyers to purchase in urban areas. Convenience to their job and commuting costs were both more important to this group than any other, and the desire for proximity to the amenities that cities offer played an important role in their decision.
Another interesting fact is that millennials start buying homes at a median of 29 years old. This means that many of them may already have a stable source of income before they even start acquiring properties. Buying at a later age, armed with proper education (being the most educated among age groups), and with a stable source of income (2-4 times higher household income) makes them a dominant group of buyers in the real estate industry.
Millennials and Real Estate Crowdfunding
What do these numbers tell us? As a real estate crowdfunding investor, these numbers tell us to shift our focus to where the market is, and that is the millennial market.
Older Millennials (1980-1989)
- 54% prefers suburb or subdivision
- 69% said that the quality of the neighborhood is a factor in decision making
- Family-focused
Younger Millennials (1990-1998
- Convenience to workplace
- Lives solo but puts value on being close to family and friends
- Quality of the neighborhood
Millennials are loyal if you can earn it
They’re also the largest generation in world history. 1.8 billion millennials have more buying power than any other age group at $2.5 trillion. If you’re looking for a way to grow your business, targetting millennials is a good strategy.
The best way to connect with millennials is through social media marketing that shows pure and authentic products and intentions.
Mobile-first mindset
Go mobile-first. In essence, that means you need to go micro—micro-video, micro-blogging, micro-content—and fully embrace the idea that users are often on the go and often on their phones when they use the internet.
This is critical because smartphones have transformed the way millennials communicate with one another—and the rest of us, too. It's not just that they're using their phones more frequently; it's that they value mobile more than any other platform or device as an integral part of their lives.
If you plan to invest in real estate through crowdfunding, you may want to consider projects that target millennials. Or any real estate projects that may fall within their radar such as properties in city centers, locations with easy access to transportation, and places that are near to places of work.