When it comes to real estate, millennials and Gen Zers share a lot more in common than the two generations may realize. GOBankingRates spoke with several real estate professionals to learn what millennials are seeking in real estate, what Gen Zers prioritize and where the two generations overlap with their home ownership needs.
Millennials Understand Their First Home May Not Be Their Dream Home
“Currently, millennials account for the largest demographic of homebuyers and are shifting the housing market.” said Phil DeGisi, chief product and marketing officer of Orchard.
DeGisi said first-time millennial buyers are entering the market comfortable with the fact that their first home may not be their dream home. This understanding in a competitive market allows millennials to see home ownership as an opportunity to build wealth. As a result, millennials are more open to multifamily housing options, like condos and quadruplexes, as their first home.
Live Richer Podcast: Unexpected Ways Losing a Spouse Can Affect Your Finances and Retirement
Gen Zers Have Less Buying Power Than Millennials
While millennials may account for the largest demographic of homebuyers, Gen Zers have less buying power than millennials. Many Gen Zers are currently graduating from college and feeling the financial pinch of inflation coupled with the rising cost of living.
While most Gen Zers are still renting, Kimberly Jay, licensed associate real estate broker at Compass, said this generation does want to become homeowners. Gen Zers are savers and they are starting to save up to buy homes of their own.
Both Generations Want Similar Home Styles
Both millennials and Gen Zers, said Jay, are similar in wanting homes that are move-in ready with technology, open concept kitchens and neutral, clean colors.
Kemdi Anosike, licensed real estate salesperson at Coldwell Banker Warburg, said the occupations of Gen Z buyers may also play a role in the specific needs Gen Zers have for a home. Anosike uses the example that a TikTok content creator might seek out a home with great light to shoot content.
Millennials Want Ease in a Home
Ease in a home matters to millennials, said Jennifer Tanner, licensed real estate salesperson at Coldwell Banker Warburg.
Millennials want their home to serve as a respite, not a source of stress. “They want updated appliances and easy care while enjoying a home that is easy to keep maintained, looking bright and polished. Beautiful, simple, easy-care materials help to provide a perfect blank canvas for them to enjoy decorating without the headache of envisioning an entire space from the studs,” said Tanner.
Gen Z Values Aesthetics
Ron Wysocarski, real estate broker at Wyse Home Team Realty, said aesthetics are a big factor for Gen Z homebuyers.
“Is the property visually pleasing? Can it be redecorated and renovated to match their design and style aesthetics? Is it Instagram-ready? Gen Z wants their homes to be pleasing when they take photos and upload them to social media,” said Wysocarski.
Both Generations Care About Location
Millennials and Gen Zers care about where they live. Millennials, said Anosike, seek out neighborhoods with great communities that fit their lifestyles and personalities.
There’s also a practical component involved for millennials and their real estate needs. Tanner said millennials consider the practicality of location and neighborhood, what it means for family (like schools and parks) and what it means for ease of work commutes.
The focus for Gen Z is a little less on school districts and more about the neighborhood and its proximity to their social lives.
“For Gen Zers, it’s about affordability in the best neighborhood where they can enjoy their lives outside the home,” said Tanner. “It’s more about where their friends live, and what neighborhoods have the best restaurants and social scenes, so they can easily find fulfillment outside their four walls.”
Both Generations Value Going Green
While technology and the internet make up a big part of the lives of millennials and Gen Zers, both generations care about investing in energy efficient options.
Wysocarski said millennials in particular are concerned about their home’s environmental effects and overall energy consumption. An energy-efficient property would attract millennial homebuyers as they consider their overall carbon footprint.
Both Generations Are Willing To Move
Many millennials, said DeGisi, are currently moving away from major cities. They are migrating South and West to areas that give them more bang for their buck, warm weather and access to outdoor activities.
Gen Zers, in terms of location, are looking more inland and for cities with a diverse range of industries that present opportunities for growth. But, they are okay with living in a vibrant, more affordable suburb outside of the city with a short commute.
“With the growth of remote work, there will also be increased interest in smaller cities. As Gen Z is the most diverse generation, they will want to live in communities and cities that reflect this,” said DeGisi.
While millennials and Gen Zers seek out homes that are move-in ready, both generations are ready and willing to move in order to find the right home and area that meets their needs.
More From GOBankingRates