Tuesday, August 7, 2012

Millennials: It's Cool to Save Money

Who would have guessed in the heady old days of President George Bush (the senior) when the mantra was, “whoever dies with the most stuff, wins”, that it’s now "cool" to save money. Even big banks are cashing in on the trend and coming up with hip tag lines like, "frugal is the new cool" as they promote ads and videos online that help consumers learn ways to save money.

The poor economic times—some would say “inherited” from the Bush family--are causing some major shifts in homeownership. Many young people choose to rent longer rather than buy.  Others are driven by the fact that they can’t afford a down payment or simply don’t qualify for a loan.  But add that to the fact that today there is a larger than ever percentage of single people. This results in smaller households, and these folks are seeking smaller and highly walkable places to live and work.

The Millennials (those born in the decade and a half prior to the turn of the century--1985-2000,) share some specific desires regarding their housing needs. Today the Millennials are under 30, and they are moving out of their parents houses, they want to drive less and have public transportation nearby. They don’t necessarily need or want to own a home right now. Instead, they might prefer to rent a newer, hip and modern place instead of one they might have to fix up.  (Think HGTV apartment searchs).

Generally the under 30’s are strapped for cash, so they want lots of amenities included in the rent–like a common area pool, wifi and cable; and the use of a gym. Small is OK for them, but quality and location is high on their list of priorities since this generation is trying to save money on things like transportation, and utility bills. Walking to coffee shops and social venues is also highly desired.

While renting may be the solution for most Millennials, some still want to own their own home. In particular, single moms and women from this under 30 generation view eventual homeownership as important to them. But home ownership is a goal not necessarily a target to be achieved this year or next. This group, at about 80-million strong, will make a big difference in our housing and economic future. They are presumed to be a huge rental market opportunity for landlords.

Marketeers are calling the Millennials the first generation that will choose to room together for extensive periods in order to help save for their own homes in the future. This is the Apple generation that values high tech and higher education, maybe more so than owning a home.

Landlords interested in targeting this massive generation need to observe some key points. This group has grown up with technology, so searching for a place to live will likely come by way of the Web but not just through websites; instead they will get information about rental listings from social media, like Facebook, Twitter, Instagram, and other sharing sites. To be competitive as a landlord, you have to market to this generation where they are familiar with getting their information–and that is not necessarily the newspaper.

This group also watches a lot of video—on their phones, computers and TV’s—but they are always online. And always connected.  Videos that feature your rental home and showcase how close it is to retail and entertainment centers will go far in getting this generation to stop in and check out your listing. Point out the energy-efficiency systems you’ve put in and how much tenants can save on their utility bill. Demonstrate the easy-to-care-for simplicity of your home.

Since this generation is young, it is still developing. Keeping a close eye on the Millennials will help you better understand their housing needs and desires.

Dane Hahn is a real estate professional practicing in Englewood Florida. You can reach him at dane.hahn@gmail.com or on the web at www.danesellsflorida.com

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