Millennials shape future of regional realty sector
Millennials. A buzzword and gargantuan consideration in consumer segmentation that has businesses around the world on their toes and not without reason. According to Pew Research Center, ‘anyone born between 1981 and 1996 (ages 22 to 37 in 2018) will be considered a millennial, and anyone born from 1997 onward will be part of a new generation’, and according to according to a 2018 Forbes article ‘millennials are in the driver’s seat, as they are currently the largest market’.
Jonathan Moed, in a 2018 Forbes article cites that ‘the majority of Mena region’s consumer base (over 100 million of its 400 million people) are young millennials. As companies operate in today’s market, it is vital to understand what drives millennials to make a purchase, what inspires their loyalty, what makes them ‘like’ you. You may ask why. Well, if knowing who your customers are, what they want, getting into the nitty-gritty of if they prefer it rare or well-done does not govern the lifeline of your business, then you have truly nailed it. But for others, it could result in a ‘Kodak moment’. The company ruled the photography industry back in the days but what they failed to do is innovate to meet the requirements of the new generation of customers.
Like all other industries, the real estate sector is also required to ‘keep up with the millennials’. The 2018 Better Money Habits nillennial Report by Bank of America indicates that ‘33 per cent of millennials prioritise saving towards buying their first home’. According to the 2016 Zillow Group Report on Consumer Housing Trends, ‘50 per cent of today’s US home buyers are millennials’.
Globally, they are entering the housing market in greater numbers and approaching buying a home in ways that are quite different than previous generations of home buyers. In other words, they are shaping the future of real estate. What does that mean for developers and realtors in today’s market?
It is important for developers to think about and incorporate the imperative features that the millennial home buyers want in their living space: • Spacious kitchens —For millennial buyers, the kitchen is also a part of the home where guests are entertained when compared to the previous generations who consider
the living room the most important location in the household.
• Open floor plans — Millennials don’t mind a lesser number of rooms but indicate a preference for plans where one flows into the other in order to host guests comfortably. Note how entertaining guests is a key consideration for the buyers of this generation. • Smart kitchen and bathrooms with energy-efficient appliances
— They prefer smart and energy-conscious features in these sections of the house instead of upgrading it later.
• Home offices — Working from home is quite common among millennials which means developers should include this feature in their projects.
• Location — Millennials are conscious about the commute to and from work which is why location is a key consideration.
For many millennials, the first home could be a stepping stone to their dream home which is why they also prefer properties that are ready to move into instead of having to shell out more money to do up the place. Tech savvy with personalised interaction — The National Association of Realtors (NAR) Real Estate in a Digital Age report disclosed that ‘99 per cent of millennials searched on online websites while looking for a home’. They also rely on online customer reviews more than any other generation. The 2016 Zillow Group report states that the process of finding or selling a home is a much more collaborative process for them. They bring all available tools to the process, such as their smartphones, social media, and online networks. But highlighting the importance of personal interaction in the NAR Report revealed that ‘74 per cent of millennials said they wanted help understanding the purchasing process’. This is where the role of well-informed and qualified realtors becomes paramount.
Millennials are always online. That is great news. However, developers and realtors have to bear in mind this is a smart generation who chooses the information that they receive and can separate the wheat from the chaff. So, while you embrace social media, video content, and virtual reality to reach out to them ensure that it is done strategically, tastefully, and for bonus points plugin authenticity.
The writer is chief executive of Arthur Mackenzy Properties Group. Views expressed are his own and do not reflect the newspaper’s policy.