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Best Practices: Selling to Millennials

posted Apr 6, 2018, 2:50 PM by Joyce Evans   [ updated Apr 6, 2018, 3:51 PM ]
By PSAR 2018 President Jan Farley,

You may have heard that it’s difficult and challenging to sell to millennials. Instead of building equity, these young people are opting to either rent or move back in with mom and dad for reasons other than there aren’t enough available attractive properties on the market (although low inventory of starter-homes is certainly a reality).  

A recent Experian study revealed several reasons why potential buyers shut the door on homeownership. Some of them want more flexibility to relocate than owning a house might allow. Others have little desire to carry as much debt as is required to purchase a home. They worry about their ability to afford a home with sizable student debt. Still, others do not want the responsibility of maintaining a home and would prefer to pay a landlord for upkeep. According to Pew Research, a growing number of millennial women are prioritizing their education and careers over marriage and buying a home.

I believe millennial homeowners are good for our society. Zillow reported that among first-time millennial homeowners, 17 are Hispanic or Latino, 10 percent are African American and 7 percent are Asian or Pacific Islander. An increased presence of millennials in the housing market will help boost diversity. (66 percent of millennial homeowners are white.) Today’s millennials represent the largest group of potential homebuyers, and they should not be ignored. Zillow says that millennials make up the largest segment of first-time buyers, and half of them are under age 36.

It’s our job as REALTORS® to take every opportunity given to explain the benefits of homeownership, including stability, price appreciation, tax credits, a secure path to wealth and asset accumulation, to name a few. All the studies confirm that millennials are desirous to own a home, they just may need more assistance to do so. Also, their vision may be clouded by misinformation.

So, when the opportunity arises, since knowledge is power, don’t hesitate to emphasize to worried millennials such real-world facts as:

  • Homeownership will continue to be a powerful way to build wealth. Each payment you make towards your home adds to your personal wealth, not someone else’s.
  • The fiscal benefits cannot be overlooked. Owning a home provides emotional stability, safety, financial independence and it’s a time-proven path for wealth accumulation.
  • The economy is improving, the job market is stabilizing and interest rates are affordable. Home sales statewide were at a higher level in February even when 30-year, fixed-mortgage interest rates average 4.33 percent, up from 4.03 percent in January 2018 and 4.17 percent in February 2017.
  • While it’s always important to make sound, sustainable financial decisions when buying a home, there’s never a perfect time. If you insist on perfect conditions, you’ll never get anything done. So, take the step now because we’re not guaranteed tomorrow. It may be in your best financial interest to do so sooner rather than later.
  • There are many financing and homeownership assistance programs available out there to first-time homebuyers. You may be able to afford more than you think.