The 2019 real estate market looks substantially different than it did a decade ago. The housing market has evolved each year, as the new generation became first-time home buyers and the senior generation began to downsize. Each generation has different buying behaviors, preferences and goals that are influenced by external factors such as the economy, social norms, technology and government regulation. For example, Baby Boomers are waiting longer in life to downsize than their older Silent Generation counterparts in their senior years. So how does this affect the younger generations?
In this article, we will examine the Baby Boomer, Generation X (Gen X) and Millennial generation demographics to predict their 2019 housing preferences, buying/selling behaviors and the hottest markets for each generation.
1. Baby Boomers
Born between 1944 and 1964, Baby Boomers are currently between the ages of 55 and 75 with approximately 76 million individuals in the U.S.
- Downsizing later in life: According to a post by Trulia, “Baby boomers are delaying downsizing until later in life.” Why? They are living and working longer than previous generations. When they purchased their home 30 years ago, they made sure it was "perfect" for all their needs. They feel the same way in 2019, which is why they don't have a reason to move.
- Based on a study by Realtor.com, “85% of Baby Boomers indicated they were not planning to sell their home” in 2018. This trend will continue, inventory will become even lower in 2019 as Baby Boomers postpone downsizing; making it more difficult for younger generations such as Millennial first-time home buyers and Gen Xers looking to upsize to a bigger home.
- Downsizing preferences: When Boomers finally decide to move in 2019, they will differ from the older "isolated retirement home" trend of the Silent Generation. Instead, they will look for an engaging local community populated by a variety of generations. They want an active and walkable neighborhood that provides social clubs, community/activity centers, pools, walking trails, fitness centers, health care and more. "Their primary goal will be to stay busy and be social while remaining independent", as stated in an article by Curbed.com
- Hottest markets for Boomers: Phoenix, AZ; North Port, FL; Miami, FL; The Villages, FL; Punta Gorda, FL
2. Generation X
Born between 1965 and 1979, Generation Xers are currently between the ages of 40 and 54 with approximately 82 million individuals in the U.S.
- Tech-savvy upsizing: Gen Xers are ready to upsize and they are using the internet to research and communicate with others to do so. Though not as tech-savvy as their Millennial counterparts, they spend about 2 hours per day on social media looking for the latest news and keeping in touch with friends. Plus, they are more likely to use mobile than a PC/laptop when searching for a product to buy online (59% mobile vs 54% PC/laptop)
- Upsizing preferences: Gen Xers are looking to sell their first home and upsize to accommodate their growing family. Their main focus in 2019 will be to find affordable housing in a family neighborhood where there are high paying job opportunities so they can grow their families, have education opportunities for their children and save money for the future.
- Hottest Markets for Gen Xers: Houston, TX; Miami, FL; Dallas, TX; Washington, DC; Riverside, CA
Born between 1980 and 1994, Millennials are currently between the ages of 25 and 39 with approximately 95 million individuals in the U.S.
- Knowledgeable first-time home buyers: Millennials are more informed when it comes to renovations, repairs and real estate process than other generations. Since they grew up during the development of the internet, they are very tech and research savvy. They're able to find ways to access important information such as listings, neighborhood reports, HGTV home renovation videos and other types of real estate information on their own. In 2019, they will rely on real estate agents to share information that they can't find online such as neighborhood developments, local market forecasts, local housing regulations and more.
- In 2019, your online presence will have a huge impact on whether a Millennial will hire you as their agent. Having quality testimonials, attractive social media profiles and online tools/resources are important factors that shape their decision-making in hiring an agent.
- Buying preferences: According to a Magazine.realtor article, “In 2018, 30% of Millennials purchased home for $300,000 and higher…That means Millennials and Boomers are competing for the same home.” Some similarities between the groups include a walkable and engaging neighborhood as well as a smaller home with upgraded amenities.
- In 2019, they will account for most of the first-time home buyer market as they gain more purchasing power, acquire higher paying jobs and get married.
- Hottest markets for Millennials: San Francisco, CA; Seattle, WA; Houston, TX; Dallas, TX; Washington, DC
Generational housing preferences have changed over the past decade, causing a ripple effect in the housing marketing for 2019. Boomers waiting until later in life to downsize means less housing inventory, driving up prices for younger, first-time buyer generations (or those trying to upsize). This insight into generational trends and key differences can be leveraged to your advantage – approach and communicate with these different generations with a personalized touch, and watch your prospects turn into leads.