Experienced real estate professionals understand the stark difference in consumer homeownership demands by generation. While Gen Z homeownership currently makes up only 3% of the homes purchased in the United States, nearly three-quarters of Gen Zers are saving to buy in the next six years. Millennial homebuyers are quickly making way for Gen Z, and investors are just as quickly pivoting to meet the unique preferences and needs of the latest demographic of homebuyers.
But what does today’s latest consumer demographic value most on the market?
Below, we’ll explore the demographics of young homebuyers, their influence on the real estate investment market, and what investors should know to profit from Gen Z homeownership:
But what does today’s latest consumer demographic value most on the market?
Below, we’ll explore the demographics of young homebuyers, their influence on the real estate investment market, and what investors should know to profit from Gen Z homeownership:
Demographics of Homebuyers: Gen Zers
For Gen Z, homeownership is a way to escape growing rent costs and stabilize their monthly housing costs. With median rent costs increasing nearly 40% since 2010, according to the U.S. Census American Community Survey, it’s no wonder Gen Z’s motivations extend beyond the norms of starting a family or establishing residential stability.
While Gen Z desires many similar digital innovations and socially conscious amenities as Millennial homebuyers, Gen Zers are much more value-oriented and emphasize affordability and sensibility.
Let’s look at the top characteristics of Gen Z influencing their purchasing decisions:
While Gen Z desires many similar digital innovations and socially conscious amenities as Millennial homebuyers, Gen Zers are much more value-oriented and emphasize affordability and sensibility.
Let’s look at the top characteristics of Gen Z influencing their purchasing decisions:
Creating a Digital Journey
Generation Z is the most digitally connected generation yet. Like Millennials, they are comfortable using technology for every aspect of the home-buying process. For real estate professionals, this emphasizes the importance of turning the homebuying journey as digital as possible.
To reach and influence today’s young homebuyers, look to incorporate:
To reach and influence today’s young homebuyers, look to incorporate:
- Online Listings: High-quality photos, 3D tours, and detailed layouts and descriptions of properties in multiple locations online are now essential for attracting today’s homebuyers.
- Social Media: Real estate investor networking in the digital age hinges on your ability to connect and influence other professionals and consumers online. There is no better place to do that than on the top social media platforms, like:
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- YouTube
- Snapchat
- TikTok
Building your brand by posting regular, high-quality content that entertains or provides value to consumers will get you and your properties recognized by today’s consumers.
- Virtual Transactions: The less necessary you make in-person interactions, the more likely you are to capture the attention of Gen Zers, who are more comfortable with digital transactions and convenience. Adding virtual tours, e-signatures, and online mortgage applications to your practice will bode well in the eyes of young homebuyers.
Providing a Green Living Environment
Going green has gone from a movement to a lifestyle. In 2024, socially conscious Gen Zers view their home as an opportunity to express their views on sustainability. What does this mean for investors? Natural living home designs and decor will attract Gen Z homebuyers and boost profits.
For natural living home designs, look to incorporate the following:
For natural living home designs, look to incorporate the following:
- Biophilic Elements: Colorful interiors with earthy color-toned furniture and linens, potted plants, and textured earthy designs are desirable. Consider adding water bodies, like indoor salt pools or exotic fountains, and natural woods into the home’s decor.
- Sustainable Materials: Eco-friendly home improvements like solar panels, tankless water heaters, and efficient doors and windows are in demand for Gen Z homeownership. If you lack the funding for larger green living renovations, less costly DIY fixes like adding LED lighting or installing Energy Star appliances can be a quick win to draw appeal.
- Natural Living Designs: Help homeowners utilize natural lighting by creating open concepts with bare windows. Living walls and skylights are also highly attractive additions that may catch Gen Zers eyes.
Emphasizing Affordability
As mentioned, affordability is a top priority for today’s young homebuyers. With many Gen Zers freshly entering the job market, managing student debt, and navigating the complexities and costs of ongoing inflation, several key trends have emerged from the latest homebuying consumers, including:
- Smaller Homes: Gen Z consumers are drawn to smaller, more affordable homes. While they value tech-savvy appliances and natural living amenities, the less maintenance and financial burden a home creates, the better.
- Suburban Markets: While metropolitan areas continue to expand and urban living will always have its appeal, motivated Gen Z homebuyers are turning to suburban or even secondary markets to find homes. With remote working here to stay, many Gen Zers are opting for more affordable suburban lifestyles to the costs of urban dwelling.
- Shared Spaces: With today’s costs, the interest in shared spaces is a new phenomenon among home shoppers. Adding an ADU unit to your investment property to provide co-living or rentable space options for homebuyers ca
Conclusion
With Gen Z homeownership on the rise, it’s time to tap into the minds of Gen Zers and focus on their unique wants and needs. For investors looking to outpace the competition in a competitive fix and flip market, consider incorporating the following strategies:
- Leverage Technology: Bringing the young homebuyer’s purchasing journey to the digital playing field is a recipe for success in 2024 and beyond. Leverage social media platforms, online listings, and virtual transaction tools while utilizing high-quality content to promote your properties, educate, or entertain your target audiences.
- Provide Green Living: Similar to Millennial homebuyers, Gen Z wants to express their passion for sustainability within their living environment. Utilizing sustainable materials and green-friendly renovations and appliances will catch the eyes of today’s consumers. Additionally, bringing a more natural living design to the home with natural lighting, open spaces, natural woods, and biophilic elements will tap into the aesthetic wants of Gen Zers.
- Emphasize Affordability: With today’s growing market prices and higher-than-usual interest rates, more and more Gen Zers are questioning when and how to buy a home young. The answer, for many, is a sensible and affordable approach. To appeal to today’s young consumer, tap into suburban and secondary markets with smaller or more affordable homes that offer co-living or additional rooms for rent to young families.
Winning Over Young Homebuyers with the Right Financial Approach Winning Over Young Homebuyers with the Right Financial Approach
CIVIC offers the most reliable short-term fix and flip financing options for investors looking to maximize their properties. With flexible terms and rates, our team of experts can provide the capital necessary to renovate and redesign any home to meet the unique needs of each generation of homebuyers.
CIVIC’s fast and flexible loan approval processes will get you the funding you need to capitalize on properties and find success through your investments. CLICK HERE to schedule a FREE consultation with a CIVIC team member today!
CIVIC’s fast and flexible loan approval processes will get you the funding you need to capitalize on properties and find success through your investments. CLICK HERE to schedule a FREE consultation with a CIVIC team member today!
