A growing share of home buyers are millennials, and more of them are purchasing single-family homes outside of urban areas, according to the 2016 National Association of Realtors® Home Buyer and Seller Generational Trends study, which evaluates the generational differences of recent home buyers and sellers. The share of millennials buying in an urban or central city area decreased to 17 percent (21 percent a year ago) in this year’s survey, and fewer of them (10 percent) purchased a multifamily home compared to a year ago (15 percent).
The vast majority of recent home buyers consulted a website (89%) at some point during their home search, with real estate agents (87%) close behind, according to the NAR study.
“A majority also used mobile devices to assist in their home search, with more than 2 in 3 Millennials (21-35) using a mobile or tablet site or application,” MarketingCharts reported.
Specifically, AudienceSCAN found 14.5% of adults used Zillow in the past 6 months to research or purchase a specific product or service.
“Interestingly, online video sites were used more by older than younger home buyers. Also of note, home buyers were more likely to have found their home on the internet (44%) than through a real estate agent (33%), though that wasn’t the case among buyers over 60 years of age.”
Keep this in mind when advertising with TV stations: 18% of Zillow Users watched a video from a local television website via their website or app from a mobile device in the past 6 months, according to AudienceSCAN data.
“The most useful website features among those who used the internet to search for a home were:
- Photos (87%);
- Detailed information about properties for sale (84%);
- Interactive maps (45%);
- Virtual tours (42%); and
- Real estate agent contact information (40%).”
Note that 38.2% of Zillow Users carry iPhones, AudienceSCAN reports. Think about how video and photos look on an iPhone when marketing homes and real estate brokerages.
Characteristics of Buyers
The median income of millennial homebuyers in this year’s survey was $77,400 ($76,900 in 2014), and they typically bought a 1,720-square foot home costing $187,400 ($180,900 a year ago). The typical Gen X buyer was 42 years old, had a median income of $104,700 ($104,600 a year ago) and typically purchased the largest home compared to other generations (2,200-square feet), costing $263,200 ($250,000 last year).
Generation X buyers (71 percent) were the most likely to be married, younger boomers had the highest share of single female buyers (20 percent), and 12 percent of millennial buyers were an unmarried couple.
Reach these Zillow Users with ads/coupons in their mailboxes, because AudienceSCAN revealed 41.5% of them took action after receiving these in the past month.
This year’s survey found that the millennial generation’s desire to own a home of their own as the primary reason for their purchase is increasing, up to 48 percent (39 percent a year ago). The desire for a larger home was the highest among Gen X buyers (16 percent), and older boomers (at 20 percent) were the most likely to buy because of retirement.
Overall, the majority of buyers in all generations continue to purchase a single-family home in a suburban area, and the younger the buyer, the older the home they purchased.
Lawrence Yun, NAR chief economist, says while millennials may choose to live in an urban area as renters, the survey reveals that most aren’t staying once they’re ready to buy. “The median age of a millennial homebuyer is 30 years old, which typically is the time in life where one settles down to marry and raise a family,” he said. “Even if an urban setting is where they’d like to buy their first home, the need for more space at an affordable price is for the most part pushing their search further out.”
Adds Yun, “Furthermore, limited inventory in millennials’ price range, minimal entry-level condo construction and affordability pressures make buying in the city extremely difficult for most young households.”
And TV commercials won’t hurt in targeting Zillow Users either. AudienceSCAN reported 70.2% took action after seeing television (over-the-air, online, mobile or tablet) spots in the past year.
For the third straight year, the largest group of recent buyers were millennials, who composed 35 percent of all buyers (32 percent in 2014), more than the combined amount of younger and older boomers (31 percent). Generation X were 26 percent of buyers, and the Silent Generation made up 9 percent.