House hunting across the generations
When it comes to real estate, there are distinct homeownership trends that define each generation. A report published by RE/MAX LLC shares some interesting insights into how each generation approaches homeownership.According to Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, there is still value to be found in this study. “Certain trends that start in the USA tend to catch on locally – if not immediately, then possibly in the years to come. After reading this study, I would venture to say that the results are not dissimilar to the trends that we are noticing locally too,” he explains.
According to the report, 43% of first-time buyers in the USA reported a lack of funds as a current barrier to homeownership. But it is not only first-time buyers who are feeling the pinch. The research study also revealed that 80% of recent American homebuyers reported compromising on their priorities – whether in the form of cutting down on everyday living costs or making financial trade-offs around transportation.
'Semi-grating'
“Affordability is also a known issue here – especially now that interest rates have dramatically increased in such a short space of time. Compromising on search criteria is also something we have noticed, especially for those who are semi-grating, as property prices differ greatly between provinces which means that buyers might not be able to afford a home of the same size when moving across the country,” Goslett notes.
For first-time and younger buyers in particular, the research report writes that many within the USA are expanding their definition of what constitutes “good enough”. People are looking for real estate agents who can help them sort the must-haves from the nice-to-haves and spot value in options they hadn’t previously considered.
Forty per cent of Americans also say that terminology/language is a key barrier to homeownership – that’s up from 17% in 2020. Hit the hardest by this is the younger generation, with only 28% of Gen Z in the US able to accurately define key terms such as “mortgage rate”.
Goslett confirms that the local market is not dissimilar in this regard. “There is a massive knowledge gap among most buyers – and this is across the age groups. That’s why a real estate agent is so important. A good real estate professional will be able to guide you through every step of the process and help you better understand the various terminology and processes that form part of the property transaction,” he explains.
Another interesting trend that the report highlights is the emotional nature of the whole house-hunting experience. The report states that ‘[f]rom navigating financial hurdles to celebrating milestone moments, homebuying is a deeply personal and emotional process. At least half of Americans report crying at least once during the experience, with this number rising to 65% amongst Gen Z buyers.’
Other interesting trends that the report reveals include:
• Owing to affordability, Gen Z buyers are more than twice as likely to buy with friends than older generations.
• 91% of Gen Z-ers say having a “green home” is important to them, compared to 85% of Gen Y, 73% of Gen X and 60% of boomers and seniors
• Gen Z buyers are more interested in smart features (78%), new builds (77%), and sustainable materials (81%) than older cohorts
• More than half of millennials and Gen Z-ers would move to the suburbs and rural areas, compared to just 45% of Gen X-ers and a third of boomers.
• 65% of Gen Z-ers surveyed said they require their home to have a dedicated workspace, compared with 25% of U.S. adults overall.
“Across all the generations, homeownership is viewed as a valuable milestone to reach within one’s lifetime. While each generation will follow and form their own set of unique trends, all generations can benefit from working closely with a reputable real estate professional who can provide valuable and expert guidance and support throughout the homeownership journey,” he concludes.