Last month, I reflected on the success of the real estate market in 2018 and predicted a similar path of continued success in 2019. One thing that should lead to further success in our local real estate market is the up-and-coming generation of Millennial buyers. Looking forward, 2019 and 2020 are expected to be the peak years for home purchases by this group of young adults approaching their 30s.
The Millennial generation is no longer the new kid on the block. They constitute the largest group of home buyers, accounting for 45% of mortgages recently (compared with 17% for Baby Boomers and 37% for Gen Xers). Millennials are likely to make up the largest share of home buyers for the next decade as their housing needs become ever present.
Buyers approaching their 30s are likely to be applying for loans with student debt coupled with an unpredictable mortgage rate market. This generation typically values their living expenses and travel equal to that of home ownership. Because these young consumers like to dine out, shop and travel, while still seeing the value in purchasing a home, it is expected that they will be far more price-conscious than past generations.
This new group of buyers is stepping into a real estate market that has experienced excellent growth and appreciation over the past few years. However, they are also entering the market with different needs and desires than previous generations of home buyers.
A few millennial home buying trends I think will play out in 2019 and beyond:
‒Smaller Homes: Millennials are generally starting families later in life and they tend to be a bit more efficient in terms of space. Smaller homes typically cost less and are more affordable overall. Currently about 70% of Millennial homeowners reside in a residence that’s 2000 sq. ft or less.
‒Artificially Intelligent Homes: This new generation of home buyers have lived with “smart” technology their entire lives, and their penchant for integrative technological features has become apparent in the grow of the AI marketplace. Because of this, we can reasonably predict that homes with advanced and integrative technological features will become increasingly more attractive to Millennial home buyers.
‒Suburban Homes: Typically, the suburbs have offered a bit more affordability than old, mature neighborhoods in the city. Suburbs also offer more new construction projects and thus, newer and more modern construction styles and features. These lower costs and newer homes are likely to appeal to new buyers (much like they did for the prior generations).
At 8z real estate we are committed to knowing the current market, who the current buyers are, what they are looking for, and how to best market homes for sellers to the right buyers.
Give me a call to discuss how the current real estate market in 2019 will work towards your best interests.
In Weld County for December 2018, the average sales price* was:
$344,135 for Single Family Homes (up 4.3% from 1 year ago)$256,576 for Condos/Townhomes (up 7.9% from 1 year ago)
I have access to detailed stats across Colorado and can help you find out the worth of your property any time. I can also help you determine what your home is worth even if it’s in a different area. As always, I am here for you. If it’s time for you to buy or sell, let’s talk.
*Median sales price based on a six-month moving average