millennials and home · the majority of gen y consumers are looking for homes between 2,000 and...

Consumer Insights 2014Survey Period August – October 2013

Millennials and HomeWhat You Need to Know Today

CONSUMER INSIGHTS 2014

• A Little About Us…

• Demographic Trends

• Creating Answers Together

– Product Solutions

– Community Solutions

– Trends We Must Answer

Our Agenda – The Millennials

Our Mission: Trusted Analysis for Executive Decisions

Market Coverage

Key Leadership in 9 Offices in 7 States

Jody KahnSr. Vice President

Dan FultonSr. Vice President

David KalosisSr. Vice President

Lesley DeutchSr. Vice President

Lisa M. JacksonSr. Vice President

Don WalkerPresident

John BurnsCEO

Steve DutraSr. Vice President

Ken PerlmanSr. Vice President

Mollie CarmichaelPrincipal

Dean WehrliVice President

Pete ReebSr. Vice President

Lance RamellaSr. Vice President

Nicole MurrayVice President

We have taken pride in our team and our leadership throughout the company. Many of our team members know

many of your assets. We will rely on the most qualified talent with the greatest market knowledge for the analysis and

strategy on your assets.

Chris PorterVice President

Market Health

Demand by Lifestage

and Price

Consumer Preferences

Housing Supply

Competitive Environment

Product

Solutions

Financial Testing

Marketing and Sales

Lower Risk

Better Profit

Better Decisions

Vision & Leadership

ProfitableResults

CONSUMERINSIGHTS2014

Who Are The

Millennials?They were born..?

1978 to 20001980 to 20001982 to 20001984 to 2000


Why GenY?

92million today born from

1980 to 2000

or 4.4 million per year

They are the largest generation:

1980-2000

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000

4,500,000

5,000,000

2015

2014

2013

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1931

1930

Year Born

2015 Population by Year Born

Sources: U.S. Census Bureau December 2014 Population Projections; John Burns Real Estate Consulting, LLC

53%+/- of the 92M are 25 years or older.

48 million of this population will be 25 or older in 2015.

What does it mean today for housing?

20% of aged 25+ population in 2014



Sources: U.S. Census Bureau

December 2014 Population

Projections; JBREC

This generation is far more diverse.

14% were born inanother country

Source: U.S. Census Bureau December 2014 Population Projections

Marriage and children has dropped

significantly for the 25-29 year olds.

68% Were married with children in 1967

24% Are married with children in this

group today.

Sources: U.S. Census Bureau December

2014 Population Projections; JBREC

Annual Marriage and Children

Trends at 25-29 Years

68%

49%

40%

24%

20%

25%

30%

35%

40%

45%

50%

55%

60%

65%

70%

1967

1968

1969

1970

1971

1972

1973

1974

1975

1976

1977

1978

1979

1980

1981

1982

1983

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2008

2009

2010

2011

2012

Perc

en

t o

f A

ll 2

5-2

9 Y

ear

Old

s

Percent of 25-29 Year Olds Married with Children

Source: U.S. Census Bureau, Current Population Survey March Supplement

1980 Age for Marriage and First Child

22.0 Marriage

(Median)

22.7First Child

(Average)

Sources: U.S. Census Bureau Current Population Survey; Centers for Disease Control and Prevention National Vital

Statistics Report

2013 Age for Marriage and First Child

25.8 First Child

(Average)

26.6Marriage

(Median)

Sources: U.S. Census Bureau Current Population Survey; Centers for Disease Control and Prevention National Vital

Statistics Report

20.8

26.6

21.4

24.4

25.8

20

21

22

23

24

25

26

27

1970

1971

1972

1973

1974

1975

1976

1977

1978

1979

1980

1981

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2010

2011

2012

2013

Ag

e

Women's Age at First Marriage and First Birth

Women's Median Age at First Marriage

Mother's Mean Age at First Birth

Sources: U.S. Census Bureau Current Population Survey; Centers for Disease Control and Prevention National Vital Statistics Report

Children before marriage shifted in 1992…

Fewer 20-24 year olds have a driver’s

license today…

93% Had a license in 1980…

77% Have a license today at 20-24.

They are more educated…

35% have a bachelor’s degree or greater.

0%

5%

10%

15%

20%

25%

30%

35%

40%

1961

1963

1964

1965

1966

1967

1968

1969

1970

1971

1972

1973

1974

1975

1976

1977

1978

1979

1980

1981

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2003

2004

2005

2006

2007

2008

2009

2010

2011

% of 30 Year Olds with a Bachelor's Degree or Higher

Source: U.S. Census Bureau, Current Population Survey March Supplement

…They have more debt.

$1.1

1

6%

8%

10%

12%

$0.0

$0.2

$0.4

$0.6

$0.8

$1.0

$1.2

Q1-

04Q

2-04

Q3-

04Q

4-04

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05Q

2-05

Q3-

05Q

4-05

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06Q

2-06

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4-06

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2-07

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4-09

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2-10

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Q1-

11Q

2-11

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4-11

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2-12

Q3-

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4-12

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13Q

2-13

Q3-

13Q

4-13

Q1-

14Q

2-14

Trilli

ons

Total Student LoanTotal Student Loan Balance = $1.12 % of Balance 90 Days Deliquent = 11%

Source: NY Federal Reserve Consumer Credit Panel/Equifax, John Burns Real Estate Consulting, LLC (Q2-2014, Pub: Nov-14)

$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$40,000

$45,000

$50,000

1947

1948

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2013

Med

ian

In

co

me

Median Income, 25-34 Year-Olds (Inflation-Adjusted 2013 Dollars)

Males

Females

Source: U.S. Census Bureau, Current Population Survey, Annual Social and Economic Supplements

Male Incomes for the older (25-34) Gen Y

workers are lower than 40 years ago.

$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$40,000

$45,000

$50,000

1947

1948

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1995

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2001

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2004

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2009

2010

2011

2012

2013

Med

ian

In

co

me

Median Income, 25-34 Year-Olds (Inflation-Adjusted 2013 Dollars)

Males

Females

Source: U.S. Census Bureau, Current Population Survey, Annual Social and Economic Supplements

Female incomes are up, largely as a

result of increased participation.

0%

10%

20%

30%

40%

50%

60%

70%

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

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2008

2009

2010

2011

2012

2013

Q3-

2014

Homeownership Rate by Age

30-34

25-29

Under 25

Source: U.S. Census Bureau, Housing Vacancies and Homeownership Survey

Homeownership for the 25-34 year olds is

lower than other generations.

Gen Y presents some great opportunities for the

future:

• They are huge in volume

• They are highly educated

• They have pent-up household

formation today

• They will be getting married and

having children – just delayed.

29


• TOTAL SURVEY RESULTS:• 3 surveys completed annually• 50,000+ Responses• National and Local Primary • Focus: Community and Home

Preferences• Typical cost could be $4,500 versus

$45,000 for great primary research

Consumer Insights is an annual consumer survey that is a “focus-forward” studyon what new home shoppers want next…when they buy their next home.

What is Consumer Insights?

30


Consumer Insights 2014Respondents:

2013 Home Shoppers

2,117 Resale (Zillow Shoppers)

19,915 New Home

Our recent survey has a terrific sample!

31

CONSUMER INSIGHTS 2014 What does it cover?

Attitudes

• How they live

• How they shop

• What they value

Interior Style

• Interior style preferences

• Exterior style preferences

• Interior specifications

• Texture

• Color

Home

• Kitchen

• Bathroom

• Private outdoor living

• Great space

• Architectural Style

• Yard Preferences

• Specifications & Technology

Community

• Community Amenities

• Lifestyle


Who is your new home consumer?

CONSUMER INSIGHTS 2014This generation has many lives today…

Born 1980 to 2000

CONSUMER INSIGHTS 2014What age do they begin shopping?

• Why are their fewer Gen Y shoppers versus their overall population?

• Of the 15% of Gen Y’s shopping today…

4% are under 25

33% are 25-30

63% are 30+ years and older!

CONSUMER INSIGHTS 2014…and with that comes opportunity!

Today, Gen Y’s 25+ is…

20% of the population today.

15% of the new home shoppers

according to our last survey.

Silent Generation (Prior to 1946) 9% 15% 11%

Baby Boomers (1946 - 1964) 44% 36% 32%

Gen X/Echo Boom (1965-1979) 32% 29% 27%

Gen Y / Millennials (1980-2000), 25+ Only 15% 20% 30%

Generation

National

Average

2014

Population

2019

Population25+ Population

CONSUMER INSIGHTS 2014Gen Y’s new home shopping population by region:

Does it shift from 15% on average regionally? Yes…for logical reasons.

CONSUMER INSIGHTS 2014What Lifestage are they?

10% Single

46% Young

Couples

40% Families


Couples and

family

formation are a

big deal

for new

housing.

CONSUMER INSIGHTS 2014What does this mean?

“Gear Up” for Gen Y by

2019 as they

should begin

to rival their parents

In the home shopping

World.

Silent Generation (Prior to 1946) 9% 15% 11%

Baby Boomers (1946 - 1964) 44% 36% 32%

Gen X/Echo Boom (1965-1979) 32% 29% 27%

Gen Y / Millennials (1980-2000), 25+ Only 15% 20% 30%

Generation

National

Average

2014

Population

2019

Population25+ Population


What do they want in Housing?

How are they different?

…and more?

41

CONSUMER INSIGHTS 2014Home Design follows location

and price as top motivators…

Location 94% 93%

Price 90% 91%

Home design 81% 77%

Safety 66% 71%

Schools 38% 55%

Neighborhood street appeal 49% 43%

Accessibility 36% 29%

Community amenities (like pool, parks, etc.) 36% 25%

Energy savings technology 35% 21%

Prestige 13% 12%

Environmentally sensitive practices 10% 6%

The most important factors motivating consumers to buy a

new home

National

Average

Gen Y /

Millennials

(1980-2000)

Affordabilityis first for this generation.

42


Modern traditional is the most

preferred style, followed by style

on a budget, casual organic

and modern.

Their favorite styles are…

#1 Favorite Style

43


Modern

traditional is

the most preferred style, followed

by style on a budget, casual

organic and modern.

Modern Traditional is the favorite style for Gen Y

shoppers. Myth buster—Gen Y is not all about

contemporary.

Modern Traditional 23% 34%

Style on a Budget 7% 9%

Casual Organic 11% 8%

Modern 6% 8%

Casual Contemporary 6% 7%

Rustic 8% 7%

Mediterranean 9% 6%

Coastal 7% 5%

Traditional 9% 4%

Cottage 4% 4%

Minimalistic 4% 3%

Chic 2% 3%

Ultra Modern 1% 1%

Asian Inspired 1% 1%

Art Deco 0% 1%

Tropical 2% 0%

Interior style preference

National

Average

Gen Y /

Millennials

(1980-2000)

44

CONSUMER INSIGHTS 2014 They want more!

2013Av floor area 2,200 sf76%

wants larger in size versus

44% for all generations.

45

CONSUMER INSIGHTS 2014 Gen Y is much more casual…

National

Average

Gen Y /

Millennials

(1980-2000)

Favorite shoesFlip flops 23% 33%

Stylish casual shoe 30% 25%

Athletic shoes 23% 20%

Dress shoes 9% 12%

Loafers 7% 3%

Stylish Boots 1% 2%

Cowboy Boots 1% 1%

Other 5% 3%

46


The majority of Gen Y consumers

are looking for homes between

2,000 and 3,000 square feet.

This varies by

geography.

Nationally, the top square footages consumers want today are from 1,500 to 2,500; however, most Gen Y consumers are looking for 2,000 to 3,000 square feet.

Home size preferenceLess than 1,000 square feet 1% 0%

1,000 to 1,499 square feet 7% 5%

1,500 to 1,999 square feet 24% 18%

2,000 to 2,499 square feet 28% 29%

2,500 to 2,999 square feet 21% 25%

3,000 to 3,999 square feet 15% 18%

4,000 to 4,999 square feet 4% 4%

5,000 square feet or more 1% 1%

National

Average

Gen Y /

Millennials

(1980-2000)

47

CONSUMER INSIGHTS 2014 They are less about privacy…and more about pets!

Outdoor space preferenceEntertainment and recreation 76% 76%

To provide privacy between me and my neighbor 79% 67%

Children's play area 41% 63%

Pets 48% 54%

Gardening space 43% 32%

Connection with the outdoors 53% 30%

National

Average

Gen Y /

Millennials

(1980-2000)

48

CONSUMER INSIGHTS 2014 They want a lawn or a yard with a view…

Large open lawn 15% 30%

Open with seating area and views of mature trees and vegatation 25% 22%

Covered outdoor room with fireplace 30% 15%

Small area with firepit and seating 9% 9%

Open area with views of woods 6% 6%

Open area with firepit and seating 5% 6%

Vegtable garden 5% 5%

Small lounge area 4% 4%

Kid's play area 1% 2%

Backyard preference

National

Average

Gen Y /

Millennials

(1980-2000)

49

CONSUMER INSIGHTS 2014The majority of Gen Y consumers

want suburban.

Suburban master plan 41% 40%

Suburban Large Lot 22% 27%

Traditional Neighborhood Dev 21% 18%

Rural 10% 9%

Urban 5% 5%

Ideal Lifestyle

National

Average

Gen Y /

Millennials

(1980-2000)

5% want urban.

50


Rural

Bedroom Suburban (60+ mins)

Outer Suburban (30-60 mins)

Inner Suburban (15-30 mins)

City Core

The highest percentage of

consumers want to live within 15-

60 minutes away in the 1) Inner

Suburban areas followed by the

2) Outer Suburban areas.

Interestingly, only 16% chose the

City’s Core.

The least desirable location was

“Bedroom Suburban” locations,

60+ minutes away.

Locational preferenceInner suburban 45% 55%

Outer suburban 37% 38%

City core 13% 16%

Rural location 11% 10%

Bedroom suburban community 7% 5%

National

Average

Gen Y /

Millennials

(1980-2000)

51

CONSUMER INSIGHTS 2014 They want single family.

Home type preference

SFD 77% 84%

SFA 7% 6%

Depends 14% 9%

No preference 3% 2%

National

Average

Gen Y /

Millennials

(1980-2000)

84% prefers single family detached.

BUT…this comes down to affordability…and choice!

52

CONSUMER INSIGHTS 2014 Top 10 Trends, Gen Y

1. Design matters. Home design is amongst the top motivating factors.

2. Yes…they want to own.

3. They want suburban and single family detached as they marry and have children. Single Gen Y households are more attracted to more urban locations for rental opportunities.

4. Affordability is #1. They WILL drive for affordability. However, they want to live 15 to 45 minutes from the core. Like their parents, they will drive for size as they marry and have children.

5. The want bigger…inside and out for their growing households.

6. Focus on function over size.

7. Think social. Social Indoors and outdoors. They are a more casual generation and privacy is less important.

8. They want energy efficiency but they are not ready to pay for it yet. They want efficiency most! Time is the greatest commodity.

9. They love their dogs too! Pet parks are important for Gen Y and their parents.

10.Gear up for Gen Y to more than double in size in 2019+. Look for this generation in the home shopping world in their late 20’s and early 30’s.


There is a lot more…

Remember…All of these trends change

by geography and price.

Home & Specifications

Community

Product Solutions

Communication

ThankYou!Let us help.

Demographic Trends. Consumer Insights. Product Solutions.Please contact:Mollie [email protected] or 949-870-1214Chris [email protected] or 949-870-1218www.realestateconsulting.com

mailto:[email protected]

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millennials and home · the majority of gen y consumers are looking for homes between 2,000 and...

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