2014 Home Buying Patterns Defined by Generation
Who’s shopping? The National Association of Realtors recently released its second annual “Home Buyer and Seller Generational Trends” study, providing insights into generational differences in behavior. The report puts forth useful details regarding preferences on location, style, size and condition of new home purchases for Generations X and Y, Younger and Older Baby Boomers and the Silent Generation also dubbed “The Lucky Few.”
|Generation||Year Born||Age in 2014|
|Millennials/Gen Y||1980 – 2000||34 and younger|
|Gen X||1965 – 1979||35 to 49|
|Younger Boomers||1955 – 1964||50 to 59|
|Older Boomers||1946 – 1954||60 to 68|
|Silent Generation||1925 – 1945||69 to 89|
Surfing and Referring
The report also highlights the use of internet among age groups involved in the home search process, prevalent in the younger groups and gaining traction. Especially for the 61 percent making up the bulk of purchasers, home-buying activity begins online. Across the board, all buyers rely on word-of-mouth or previous experience in selecting a realtor.
Internet Babies Growing Up
Not surprisingly, virtual shopping is led by Gen Y or Millennials, so named for having grown up with the internet. This largest group of purchasers, currently pegged at 31 percent of all home buyers, will grow year on year as those born between the early 1980s through the early 2000s populate the 20-something to under-35 age category. Plugged-in Gen Y is most likely to turn to their digital devices to search out information about conducting the home buying process, with more than half of them using mobile to do so, resulting in 26 percent actually finding a future home during a mobile search. Millennials make up the largest share of first-time buyers (76 percent), require financing (97 percent) and tend to require a location within 10 miles of their current home for proximity to work.
School Runs and Office Hours
Gen X, those born from the close of the baby boom in the early 60s through the early 80s, are typically married (72 percent), with children under 18 living at home (67 percent). They’re buying a larger home, or moving from rental, looking at relocation or improving convenience and commute. Representing 30 percent of all buyers, busy Gen X buyers spend an average of 12 weeks looking for a purchase, beginning with an online search which is likely to involve a mobile device for at least half of these prospective home owners. Of those, 22 percent actually find their new home via mobile searches.
Call Me, Maybe?
Younger Boomers, those born between 1955 and 1964, are in their 50s now. Looking at post-recession home valuations getting back above water now, they are buying (16 percent) and selling (21 percent) in nearly balanced proportions with about one-quarter of all purchases involving a second home. More accustomed to working with a realtor and inquiring about commission rates, this age group responds well to personal phone calls over electronic communications.
Older Boomer Americans born from the close of World War II from 1946 to 1954 account for 14 percent of recent home buyers. Motivated by proximity to family, convenience, downsizing and affordability, they frequently look at newer construction to avoid costly home maintenance and repairs. This generation is most likely to move to a new region in 22 percent of home purchases realized. Some 27 percent of these boomers own a second home or investment property.
More of them currently sellers (16 percent) than buyers (9 percent), this smaller cohort are those born during the Great Depression and World War II years, 1925 to 1945. Sandwiched between the Greatest Generation and Baby Boomers, this group rode the wave of corporate growth through the 50s and beyond, living longer, active lives well into retirement years. They’re repeat buyers (98 percent), cash buyers (55 percent) and long-time owners with more equity.
Laurie Jo Miller Farr loves walkable cities. A tourism industry professional and transplanted New Yorker by way of half-a-lifetime in London, she’s writing about the best of the bay and beyond for Yahoo, USA Today, eHow, and on Examiner.com.