According to a research report by Fannie Mae, in the course of 2018, millennials have purchased homes at more than two times the rate of other age groups, even in spite of the high interest rates that have dominated the market.
As the year comes to an end, all that activity has had a massive impact on the market and new trends are emerging that will have a huge impact on real estate in the coming year. Here are a few of the most important things to keep your eye on.
1. Starter Scarcity
While a large proportion of the market is looking to buy small starter homes, the opposite has been happening. Builders are shifting their efforts toward bigger homes on the basis that the costs of building are too high to make enough profit with small homes, hence the need to scale. depending on the location and market in the area, people looking for starter homes may need to pay a premium.
2. Tech’s in Vogue
One of the characteristics of millennials is their attachment to their devices, especially their smartphones. With this in mind, it’s not a surprise that millennials want homes that come equipped with or are ready for smart home features for security, convenience, and entertainment. Specific gadgets that are particularly in demand include smart alarms, smart locks, and smart kitchen appliances. Generally, energy-saving devices and fixtures are also highly desirable because they appeal to the millennials environmentally conscious mindset as well as their frugality.
3. Sweat Equity
Between real estate reality TV shows and plenty of home-buying sites to browse, millennials know quite a bit about home renovations. The implications of this are that millennials are likely to buy houses that aren’t in good shape and then take on the project of repairing and decorating them to their own specific tastes. The adventurous mindset of millennials and improved capacity due to nootropics (what are nootropics?) and other factors are a perfect fit for them to undertake major home remodeling projects.
4. Rising Interest Rates
Mortgage rates recently topped a seven-year high, thus reflecting the economic surge and increased demand. As the trend continues into next year, buyers will be more likely to adopt a cautious approach by taking more time to study the market before buying a home. This could result in a slowing down of the market and a shift of focus toward value-oriented homes as opposed to luxury ones.
5. Social Media
If it’s not on social media, then it doesn’t exist! ...Or so it seems from the way social media has dominated every aspect of life today, including real estate. Nowadays, real estate showings are being conducted via pictures and videos (including live video) in order to give millennials a more comprehensive view of the home without interrupting their hectic lifestyles. Buyers and sellers alike will be working to leverage the platforms to get good deals, promoting the idea of a peer-to-peer market, and reducing the importance of agents and other middle-men.