For the last few years, Millennials have been closely monitored to ensure that the housing market is responding to their needs. They made it through the housing crash that took place from 2007 until 2012 and became the largest home buying group on the market.
While Millennials have been able to navigate the housing market successfully, it’s time to prepare for the next generation of homeowners: Generation Z.
Understanding Generation Z
To assist the new generation, we need to know exactly what we’re dealing with.
Generation Z refers to those born between 1995 and 2012, and includes approximately 75 million people. While they’re still relatively young, this generation knows exactly what they want, and will endeavor to get exactly that.
If you can’t meet their needs, they’ll find someone that will.
The digitally connected world that Gen Z has grown up in has given them the ability to make more informed decisions and compare all available options before making a commitment. This means they’ve become accustomed to instant gratification and are accustomed to being surrounded by far more possibilities than previous generations.
Additionally, they’ve grown up in a world filled with opportunities, and have had far more financial freedom than the generations before them.
Taking on the real estate market
If you can attract the Gen Z market and add them to your farm, you may experience an influx of business.
During the 2016 REALTORS® Conference and Expo in Orlando, real estate experts consulted a panel made up of the Gen Z group about their views on the housing market. They found that 97 percent of them are looking to own a house during their lifetime—81 percent of which stated that they will use a real estate agent to assist them.
As a tech-savvy generation, they’re looking for brands that make use of apps, social media, and other digital platforms to reach out to them. When it comes to making purchasing decisions, Gen Z will often shop around online to find the best deal, and the same can be said for property.
Saving money is a priority for many, and they’ll always seek the most cost-effective way to get something done.
As a real estate agent, you need to listen to what they want – and deliver on exactly that.
But delivering on this need needs to be properly managed and executed, otherwise the relationship won’t work.
A recent survey found that that:
- 27 percent of this generation listed understanding their needs as the most important quality of a real estate agent
- 18 percent looked for knowledge of the local market
- 15 percent looked for experience
- 9 percent looked for negotiation skills
- 7% listed the cost of working with an estate agent as an important factor
These figures illustrate the mindset of Gen Z and reiterate the importance of understanding—and meeting—their needs.
In the above survey, 86 percent of the Gen Z group surveyed stated that they want to buy their first home before the age of 35. However, they are aware of the potential obstacles that stand in their way.
42 percent stated that earning enough money to afford the home is the biggest obstacle, with 21 percent being worried about affording the down payment, and 20 percent still paying off student loans.
What makes Gen Z different from previous generations?
The biggest differences would be their belief system and how they make decisions. They’re more open-minded because of the readily available information they’ve been exposed to online.
Additional differentiators include:
- The American Dream is no longer applicable
- Student loan debt is an all-consuming burden that causes a great deal of stress
- Terrorism is a concern as they lived through 9/11
- They’re more risk averse, with rates of drug abuse, alcoholism, and teen pregnancy being lowered substantially
- They’ve embraced an ever-evolving digital world
- They rely on technology to get things done
- They embrace diversity
- Inequality is no longer tolerated as minority groups fight for their rights
- Becoming their own boss is the ideal career path
- They’re more conservative with their finances
What does this mean for real estate agents?
First, you may need to rethink how you market yourself and do business.
It’s clear that Gen Z will use technology to make a decision. If you don’t have a strong online presence, follow tech trends, or market yourself and your product digitally, you’ll miss out.
Should you be successful in finding them a home, word-of-mouth recommendations and positive reviews will more than likely follow. Gen Z loves personal recommendations, and they’re happy to share their positive experience with others – especially in digital format.
Things to remember when it comes to Gen Z:
- They value transparency, and this builds a foundation of trust when it comes to any relationship
- Your online presence needs to share the right messaging
- You need to use the correct online platforms to reach them – YouTube, Instagram, and Facebook are the most commonly used social media platforms
- Consistency is key when it comes to communication
- You need to be prepared to respond to their needs as soon as they arise, delayed responses are a major deterrent
If anyone from Generation Z gets in touch, they’ve probably done plenty of research to ensure that you’re the right fit—and they’ll more than likely have a backup plan in case the relationship doesn’t work out.
You need to be flexible in finding their dream home, while following whatever checklist they’ve supplied as closely as possible. They’ll have done their research and know that what they’re looking for is not unattainable,
Now more than ever, you need to find a digital, competitive edge to remain relevant and outshine your competitors. Gen Z is a new breed of buyer, and you must act accordingly to get them in your farm.