When you are learning to surf one of the first things you will be taught is that you have to start paddling as fast as you can before you see or feel the wave. This doesn't make sense to us naturally, but the wave is building down deep and if you wait to see it or feel it to start paddling it will roll right underneath you and leave you stranded hoping to catch the next one.
Let me tell you, the wave is coming, can you feel it yet? What wave am I talking about? The wave the next Real Estate explosion, are your ready to catch it? What is it? Where will it come from?
It is called the Millennials, Gen Y, or the Echoboomers, they are the driving force of the new excitement we are all feeling in the Real Estate market. Who are they? How do we communicate with them?
First of all let's look at the good news there are eighty-four million of them, even more than the seventy-eight million Baby Boomers who have driven our economy for decades. Now even better news, traditionally there are five million young adults age 18-33 living at home with their parents, however this recent economy has forced twenty-nine million to stay or move back home. Just a clue, the kids aren't happy about it, and neither are the parents. A key figure in economics is the number of household formations are created per year. From 2002 to 2007 there were an average of 1.3 million households formed per year, starting in 09 we have dropped to around 350,000 households formed per year.
Think of it this way, there is a massive cork in the top of the bottle and it is about to blow. Just to satisfy the housing needs of this juggernaut of new buyers coming to the market will require 40 million more homes than we currently have available.
Let's take a look at who they are, and what makes them tick. They were born somewhere between 1977 and 1933. They are now between 19 and 35 years old. The average first time home buyer today is 31. In 2011 of all FHA loans 77% were first time buyers!
The Millennials are the first "Glocal" generation, they think globally and locally. They were raised in dual income homes, were children of divorces and day cares. They are the first generation that "everyone got a trophy." They are connected, protected, and well-educated. Multi-tasking was their survival mechanism, they have been over-scheduled from a young age.
They have always had voice mail, but hate to use it. Good luck getting them to listen to your message. They do not leave messages for each other, they look at the number of the missed call, if they know it to be a friend they call back, or simply text. They sleep with their cell phone, it is their extension of being. They are the Facebook generation, if you want to communicate with them, you will do so with texting or IM on Facebook. They also do not read emails, too slow for them. This is the most tech savvy generation in history, consider this, they will spend more than 1/3 of their lives (23 years) on the Internet.
This is one of the most diverse of all American generations, 37% are Black, Hispanic, Asian, or Native American. They are the largest 2nd generation immigration group in history, one in five has at least one immigrant parent.
In the next five years, as they start to move into management positions, salary and consumer confidence increases, there will be literally TRILLIONS more dollars spent every year in the U.S. alone.
When you want to communicate with them it won't be emails and it won't be by calling them on the phone, it will be texting and IM on Facebook. Of course there are always exceptions to the rule, but at least ask how they prefer to communicate and then honor it.
They will want to purchase starter property, they like the idea of being closer to town, they like to be able to walk to activities, think college campus when you are scouting properties. Their parents have been very involved in all of their activities and will be very involved in their home purchase as well. Maybe contributing toward the down payment as well. Be prepared to work with multiple generations throughout the process.
Who do they get their information? They are going to Google you, your company, and what you tell them. They will ask their Social media connections to give their opinions as well. The Millennials have grown up Googleling every homework assignment, they text classmates to find out what they found, doing so is part of the DNA. So don't be offended if they don't take you at face value but research what you tell them. It might be a great idea to have a Google Alert programmed for your name and your company to know what they might find. Don't be surprised if they Tweet or Facebook about the home, or even you while you are meeting. This can be great if they like and endorse you.
So here they come, the Millennials are coming of age and want a home of their own. Interest rates are at historic lows, homes prices are On Sale, here comes that wave. Are you ready? Paddle Now!!!
