Travis Robertson an expert on the next generation of real estate consumers recently gave a fascinating talk on the importance of knowing who this next generation will be, what they want, what they need and how they like to be served.
Let me begin by explaining the generational history.
1945 Or Sooner – The silent generation from WW1 and sometimes referenced as the Traditionalists.
1945-1964 – The Baby Boomers. Until now the largest wave in history.
1965 – 1976 – The Generation X. The shooting of JFK was the life event that identified this generation.
1977 – 1995. The Millennial Generation. Also known as the Echo Boomers (children of the Boomers) The explosion of the Challenger space craft identified this generation.
So why do we need to pay so much attention to the Millennial or Echo Boomer generation in real estate?
What does that have to do with you?
Good thing you asked.
The North American population statistics tell us that the population of the Baby Boomer generation was 85 Million.
The next generation or wave, Gen X population was only 45 Million.
The estimated population for the Millennial or Echo Boomer generational wave is now estimated at over 92 Million.
This is why we need to pay great attention to this wave of real estate consumers… they are the future of real estate.
As a generation shrinks the wealth needs to go somewhere. We need to transfer wealth from generations to generations.
For example down payments for purchasing real estate. The Millennial or Echo Boomer generation is very large and will be a generation that is very wealthy as well because they will receive this benefit of wealth transfer from the Baby Boomer parents.
35% of transactions and rising were Millennial or Echo Boomer on one end of the transaction or the other. They estimate that number will grow to 70% of the transactions in North America within the next 5 years.
So how do we emotionally connect as real estate professionals with this huge wave of real estate consumers?
- Work Life Balance –Their parents worked way too much to try and keep up with the Jones’ which defined their parents success.
- 61% more income.
- 24% more hours worked.
- Divorce rate up more than 200%
- 50% of all Echo Boomers parents are divorced and the #1 reason they are divorced was because their parents house was too big and made it easier for everyone living there to hide and not communicate.Therefore our next wave of consumer is wanting a smaller home on a smaller lot to avoid the same generational problems.
- Collaborative –The Millennial – Echo Boomer are from the generation that everyone wins. There are no losers, trophies or ribbons.
On report cards they have changed the RED ink on failing grades to PURPLE which is a more calm and soothing color identifying failing grades.
Therefore this group of consumer will take 1 day to pick an agent and 175 days to buy their home and they want more than anything the proper amount of time to process and make decisions like for years they were told to go to their room and think about what they did.
The next very important tip is the second showing will always be with mom, dad, siblings and BFF’s to allow the community to show up and be a part of this whole experience.
67% of them want to live close to their friends and their family if possible.
- Multicultural –Before baby boomers, most of the population lived in urban areas and the baby boomers began to migrate to the suburbs and the inner city living began to fall.
These suburb and rural areas were diverse and multicultural areas of race, religion, culture and friendships. For this reason the Millennial wants to be in a diverse cultural area and the suburbs are just too boring to them now.
- Eco Sensitive –The Millennial has grown up hearing about the carbon footprint, global warming and have bought into the importance of biking, walking and public transit.
57% of them buy into environmentally friendly homes and really focus more on the Walkability to people, places, amenities, work and more of their next home or what Google commonly refers to a Walk Score.
- Urban Setting Shift –Interesting enough we have the Millennial and the Baby Boomers wanting to now move into the urban city centers at the same time. Driving the urban prices up and forcing the Millennial to have to move into the suburbs now due to affordability in most places in North America.
We are now seeing a trend for the Millennial to purchase small single family homes on a small lot with a bunch of amenities close by to create that urban lifestyle in an affordable suburban area of communities.
This my friends is a great niche for marketing for agents in the next 5 years and for developers to consider building where possible.
This now gives us a bit of background for you to better understand the next wave of real estate consumer.
- Education Based Marketing – Educate, Mentor and teach them because they just despise being talked down to. Their top 3 hero’s are Mom, Dad and their teacher. Give them the education they are looking for. We are not the gate keeper. We are the interpreter and advisor. How do I communicate with this next generation of consumers you ask? “Don’t call me just text me generation.” The baby boomer remember William Shatner as Cpt. James. T. Kirk and the Millennial knows him as the Priceline guy.Millennial is all about speed when it comes to communication vs. the depth of the conversations and why carry on one single conversation when I can carry on 10 conversations at one time. Adapt to their needs.How do you know what their needs are? Ask them!!
- Social Media, Social Proof, Reviews –Be top of mind with them and don’t worry about what to say but just respond, like or comment. Just use the tools is all they need to feel comfortable with you. Instagram lifestyle photos or 15 second video messages on the market, tips, best buys. The bar really isn’t that high out there.
- #1 Marketing Strategy for a Millennial – MMFI – Make Me Feel Important. Go against the grain and think who can I make feel important today and how can I make them feel important today? That is leading edge marketing my friends.
We Royal LePagers love to see trends and be in front of what is coming next in the real estate business.
We cannot ignore the importance of being Millennial and Echo Boomer ready in our real estate business the next 5 years.
Those who are not are going to miss the biggest wave of real estate consumers coming into this market in history and that definitely has my attention and hopefully yours.
I trust this will give you the insight and edge to build and service your business around the next wave of real estate.