Real estate has changed dramatically over the last decade. The recent digitization of the real estate industry has been accelerated due to the limitations and restrictions brought about by the global pandemic. Still, there is another important factor at play.
The majority of shifts in buyer and seller sentiments and real estate channels come from the fact that there is a whole new generation of clients that real estate professionals are dealing with.
If you have been a real estate professional for some time, you also have probably noticed this shift in your professional life. You likely have more new millennial buyers than you did a few years ago, whereas more Baby Boomers are selling homes than any other generation.
Let’s discuss the generational trends in real estate clients and what they mean for your real estate work to give you a better understanding of how to target clients for listings and vice versa.
Generational Trends In Real Estate Clients
What We Know About First-Time Buyers
We found that around 30 percent of all homebuyers were first-time homebuyers. A vast majority of over 80 percent of buyers aged 30 years or less were first-time homebuyers.
Almost half of the real estate clients between the ages of 31 to 40 years old were also first-time homebuyers. Lastly, only around 20 percent of clients aged over 40 years old were first-time buyers.
These stats show us that first-time homebuyers are who you would expect them to be. Most first-time homebuyers are younger real estate clients, and they are less likely to have bought or owned a home previously.
However, the key thing to take away from this statistical analysis is that nearly half of all older millennials between the ages of 31 and 40 are buying homes for the first time. This information can be helpful for you if you are a real estate professional targeting first-time homebuyers.
You can focus your attention on better understanding the needs, interests, priorities, and financial situations of millennials to close more real estate deals.
What We Know About Millennial Clients
Millennials make up around 37 percent of all homebuyers, making them the largest segment of homebuyers. Of these millennials, the older ones (aged between 31 and 40 years) made the largest share of married home-buying couples at around 70 percent.
Nearly 30 percent of younger millennials (aged between 21 and 30 years) used a gift, their inheritance, or a loan from a family member or close friend to buy homes. Additionally, over 40 percent of younger millennials said they had pending student loans of around $25,000 on average to pay off.
Surprisingly, over 35 percent of older millennials had an average student loan debt of more than $30,000 that they still hadn’t paid off.
These numbers tell us a great deal about the home buying and financial situation of millennials. Most importantly, as a real estate professional, you need to focus on millennial home buyers more, as they make up the largest share of homebuyers.
Moreover, their share will continue to grow as even more millennials home buyers get older, pay off their student loans, grow their savings, and invest in homes. You need to adapt to this market trend as soon as possible because this trend will likely create a greater shift in real estate buyer sentiment.
What We Know About Generation X Clients
Generation X homebuyers make up nearly 25 percent of all homebuyers. They had a median income of more than $110,000, which also makes them the highest-earning real estate clients among all homebuyers.
This is likely what allowed them to buy the second most expensive homes with an average price of around $300,000. Gen X clients also tend to have kids under the age of 18, with over 60 percent of them having at least one young child or teenager.
As a real estate professional, these numbers mean that your most profitable real estate clients will most likely be Gen X clients. This is because of their higher average incomes and greater tendency to buy more expensive family homes.
What We Know About Baby Boomer Clients
Baby Boomers (aged 58 to 76) make up the largest segment of home sellers at more than 40 percent. The younger ones aged between 58 to 67 years old had mostly owned their homes for around 14 years before they sold them.
Whereas older ones, aged between 68 to 76, owned their homes for two extra years before they sold them. Moreover, nearly 20 percent of older Baby Boomers were more likely to buy a newly constructed home than a lived-in home.
They were also more likely to move further away from their previous homes, with an average distance of around 35 miles between their previous and new homes. In contrast, younger Baby Boomers moved an average of around 22 miles away from their previous homes.
Both young and old Baby Boomers planned to own their new homes for around 20 years, the longest among all generations.
As a real estate professional, this information should tell you that elderly clients are more likely to sell their homes than any other generation, as they make the largest segment of home sellers. If you are targeting home sellers, you need to target Baby Boomers.
Moreover, you can learn that when they decide to buy homes, they are interested in newly constructed homes, usually on the pricier side than other generations. This means that you shouldn’t overlook Baby Boomers when selling expensive new homes.
Lastly, you can show them listings that are slightly farther away from their current residence because they are more likely to move further away than younger real estate clients.
The mentioned generational trends in real estate clients can be extremely useful when targeting homebuyers and sellers. They should give you a deeper understanding of client interests, priorities, financial situations, and sentiments.
The mentioned trends will most likely amplify and bring greater shifts in real estate markets as time progresses. Just be sure that you are ready for them and you.
What We Do
We help competitive real estate professionals enjoy a work-life balance through our first-ever real estate assistance program called OktoHub. It allows you to create a large network of trusted, like-minded real estate professionals around you.
You can then post real estate assistance tasks like home inspections, staging, client meetings, showings, and more, to hire a professional in your network for help. You only hire them for the task at hand, so you don’t have to make long-term, expensive permanent hires.
You pay them for their assistance till the next time you need another real estate task that requires assistance. This allows real estate professionals like you to spend more time with family without compromising on clients or your real estate work.
OktoHub makes work life easier for real estate professionals through the most innovative real estate assistance program.
If you want to learn more about generational trends in real estate clients or about the networking and real estate assistance benefits of OktoHub, please visit our website today.