Millennials Have Fresh Take on Housing Needs
There’s a new type of home buyer on the market. They know what they want and are ready to get their hands dirty to transform a house to meet their unique needs. Stereotypical homes do not entice them; rather these buyers strive to own homes that stand apart and suit their personal lifestyle.
Make way for the “millennials,” a.k.a. GenY, the new generation of home buyers.
Two new surveys sketch a picture of the housing aspirations of young adults.
A Royal LePage survey of 1,013 Canadian millennials born between 1980 and 1994 (along with 1,011 baby boomers) asked about their attitudes toward owning a home and their ability to do so. Here are the main findings.
A good investment: The vast majority of the GenY respondents—80.3 per cent—see real estate as a sound investment. As Royal LePage CEO Phil Soper says, ”Baby boomers have built homes for themselves. They are established in their neighbourhoods and their residences have become a place of happiness for family and friends. It’s their children that are seeking to create a similar atmosphere of their own, even though new impediments exist for this younger generation.”
If I could afford it…: The main impediment is affordability. GenY is at the transition point between renting and owning, but many, particularly in BC, don’t know if they will ever be able to own a home. Across Canada, 72.4 per cent said they wanted to own someday, but were pessimistic about actually buying because of current house price affordability. In BC, 86.1 per cent were pessimistic.
Renting an option: And of those planning a move, 55.1 per cent intend to buy a home and 32.6 per cent say they plan to rent. In BC the number of renters rises 6.3 per cent to 38.3 per cent. And 21.4 per cent in BC said they actually prefer renting over home ownership.
Small down payment: Almost three-quarters of the millennials buying will be buying for the first time, and they will find the down payment a challenge: 63.8 plan to put down less than 20 per cent, meaning they will require government-backed mortgage insurance. Savings, RRSPs and the bank of mom and dad will provide down payments for 67 per cent of the respondents.
So what do they want in a house?
Another new survey, conducted for Better Homes and Gardens Real Estate, polled 1,000 young US adults between the ages of 18 and 35, but it is considered characteristic of Canadians of that age group as well. It asked what they wanted in their first or next home purchase. It discovered this group is willing to rewrite the rules to home ownership to fit their values.
Here are the findings from the survey.
Fix-it generation: Nearly 1 in 3 millennials surveyed would actually prefer a fixer-upper to a house with minimal repairs needed. Furthermore, 72 per cent consider themselves just as handy as their parents, and 82 percent of them prefer to handle home improvements on their own instead of turning to their parents. That’s a contrast to a general misconception that paints young adults as coddled or entitled.
Better, not bigger: Unlike their Baby Boomer parents, 77 per cent of millennials surveyed would prefer an “essential” home compared to a grand stereotypical luxury home.
Room for change: Millenials want each room to serve a purpose fit for their tech-drenched lifestyle. Twenty per cent would call their dining room a home office, considering what it’s mostly used for. And 43 per cent would like to transform their living room into a home theatre. Fifty-nine percent would rather have extra space in their kitchen for a TV rather than a second oven, and they seek to be entertained in every room of their home. In fact, 41 per cent of millennials would be more likely to brag to a friend about a home automation system than a newly renovated kitchen.
High tech: Eighty-four per cent believe that technology is an absolute essential to have in their homes. The most sought-after technical equipment is an energy efficient washer and dryer (57 per cent), security system (48 per cent), and smart thermostat (44 per cent). To this generation, technology is more important than curb appeal, the survey found. If a home doesn’t have the latest tech capabilities, 64 percent of millennials surveyed would simply not consider living there, according to the Better Homes and Gardens Real Estate survey.