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Houston homebuilders are preparing for a wave of Millennial buyers to enter the housing market in the coming years. Millennials – those between 20 and 37 years old – have long delayed homeownership. Housing experts attribute this trend to myriad reasons, including student loan debt, the recession and a national movement toward city living. However, economists predict Millennials – the largest generation in American history – will begin to buy homes en masse over the next 5 years.
Skyrocketing apartment rents are pushing more Millennials into homeownership, and as more Millennials start families, they’re looking to settle down, stated Scott Davis, the regional director for Houston based Metrostudy, a national housing research firm. “Overall, Millennials are a homebuying-oriented generation, ” Davis said. “As this generation of almost 80 million people now enter the homebuying market, there’s a mad rush for homebuilders trying to figure out what Millennials are going to want to buy.”
Unlike young people of previous generations, Millennials are looking for different features in their homes, Davis stated. As Millennials come of age, local homebuilders are constructing homes that cater to this emerging demographic of homebuyers.
Here are 3 things Millennials are looking for in their homes, according to Davis:
- Homes in the suburbs: Conventional wisdom says Millennials gravitate toward dense urban cities where they can walk to work and play. However, research shows that only 15% of 20-something Millennials – as opposed to 20% of Gen Xers when they were in their 20s – are living in cities. Millennials, many of whom grew up in suburbs, do want an urban lifestyle, Davis stated. However, many experts predict Millennials will actually buy a home in the suburbs where there are good schools, job growth and an increasing number of mixed-use urban-style projects.
- Small buy high quality homes: First time homebuyers were long advised to buy the biggest home they could afford. However, that’s not the way Millennials are thing, Davis stated. Millennials, unlike previous generations, want patio-style homes and smaller yards that are easier to maintain. Millennials, who grew up in the green movement, also want energy efficient homes that can save them money in heating and cooling costs, Davis stated. They are willing to trade off size for high quality homes. “Millennials expect the same high level of finish they had at their homes growing up,” Davis said.
- Homes to create experiences, not store stuff: Millennials want a lot of flexible space to entertain family and friends, Davis stated. Millennials like open floor plans, with kitchens that open into the living room and a large outdoor living space. Some may not want dedicated spaces, like a formal dining room. Many Millennials want the flexibility to turn a dining room into a study, or vice versa, Davis stated. “The Millennial outlook on life is a quest for experience,” Davis said. “Millennials are looking for places to have and share experiences with friends and family. They’re focused on doing things besides working on their house and acquiring a lot of stuff.”
Article courtesy of Paul Takahashi and Houston Business Journal