Listen to a group of baby boomers discuss millennials, and you’ll probably hear about the same things: Millennials spend too much; they go from one job to another; they live at home; they can’t communicate because they’re living in their phones.
Spend more time with people who work with millennial customers, however, and you’ll discover a more nuanced perspective. Consider housing. While many assume that millennial generation adults live in small apartments or at home, that’s not necessarily the case, according to Chris Hvostal, real estate professional (and millennial) in the Philadelphia area. Chris created his own real estate practice about eighteen months ago and took it from zero to well into six figures during that time. He attributes much of his success to his work with millennial home buyers and sellers.
According to Chris, millennial buyers spend more on real estate than other things, such as cars, clothes and other physical objects. If they buy a house or apartment, they want something nice and that is turn-key—and definitely not a project house.
They spend relatively more on a house in a neighborhood they like—places with restaurants, bars, other experiential amenities, parks (walkability and bike riding). More urban millennials are ditching their cars, too—since auto ownership often doesn’t make economic sense. It’s not uncommon for someone to buy a $500,000 house outside of Center City and not own a car.
Chris notes that millennial buyers are older than the traditional first-time home buyers, often in their 30s. His clients first found stable careers and reached a point where student debt became manageable. A lot of first-time home buyers are renting longer, then buying when they can.
While there are new zero down mortgages today (shades of 2007!), most of his clients qualify for (and opt for) traditional mortgages with larger cash down payments to control their monthly expenses. Millennial savings come from their frugality—in general, they have saved more at their age than baby boomers did at the same age.
Location is still key, with other characteristics important, but secondary. His clients gravitate toward more established places, not places on the “edge.”
Chris also notes that millennial buyers only work with someone who is straightforward and direct. They want some guidance but at the same time require complete transparency, including how Chris is compensated. Chris says the client must relate to you as a person before they can work with you as a professional.
Due to the Great Recession and student debt, it may take millennials longer to arrive at homeownership. However, their buying preferences still point to one truth: the generation of customers may change, but their basic needs for honesty and service are constant across generations.
About the Author
Jim Shulman is a guest blogger for Talent Balance. Since 1996, he has coached entrepreneurs throughout the U.S. who want more results and satisfaction from their companies. He writes and speaks regularly on the subject, particularly on the new challenges entrepreneurs face daily. When not coaching, Jim drives around in his 1957 Dodge Custom Royal sedan, and takes pictures with a 1961 Leica. Jim and Suzanne often discuss ways to tap into the large and talented Millennial market.