The CALIFORNIA ASSOCIATION OF REALTORS® examined one of the largest segment of our population, millennials in the 2014 Millennial Survey. They are now in their early 30’s and entering their prime wage earning years. How many are renters? How many are home owners? What do they look for in a home? How do they find an agent?
Who is your Typical Millennial?
• Nearly 3/10 of millennials have a college degree.
• ¼ millennials are students and only 1/3 millennials have full time jobs.
• Millennials earn a median annual income of $35K per year.
• Majority rent (41%) or live with their parents (36%), only 1/5 are home owners.
• 2/5 millennials are currently renting.
• Millennials spend a median of $1,075 monthly on rent.
• Majority rent instead of buying because they cannot afford to buy, but most expect to buy a home in the same county or same neighborhood within 5 years.
• Contrary to common belief, detached single-family homes and big lots of land are the preferences of prospective buyers.
• The majority of millennials value home ownership, giving an average importance rating of home ownership of 7.1 on a scale of 1-10.
• 1/5 millennials are homeowners. 28% of those homeowners inherited their properties. Nearly 9/10 are first time buyers.
• Affordability is the main reason for buying a home. Most millennial homeowners did not buy a home sooner due to a lack of urgency.
• They are optimistic about future home prices, with 59% expecting prices will be higher in a year and 63% think prices will go up in 5 years.
• Most millennial homeowners would like better communication with their agent and a better market understanding.
• More than ½ millennial homeowners would advise other first-time buyers to ‘do their homework online.
• The majority of millennial home buyers obtained financing. Of the 17% who paid cash, most of those funds came from personal savings.
• The average down payment for those who obtained financing was 26%.
• More than half found it easy to acquire financing, with an average difficulty rating of 4.4 on a 10 point scale (10 = extremely difficult).
• Millennial homeowners preferred communicating with their agent through email and telephone and those expectations were met, for the most part. Agents also met expectations on response time, with most responding to their clients within the time frame the client expected.
• Buyers were mostly satisfied with the home buying process and with their agent because the agent worked hard and negotiated a good deal.
• Millennial buyers found that they needed the most assistance from agents in finding the right home and negotiating the purchase price. Many felt they received a positive value from hiring an agent and would work with that agent again.