Two Generation of Buyers
By Jean Sorensen
The millennials (those born between 1972-1992) and their parents also known as baby boomers (born 1946-1965) are making the greatest impact on the real estate industry today.
“Both the boomers and the millennials want move-in ready homes,” according to Century 21 Canada president Don Lawby. His company, in conjunction with Rona, conducted a national home buyers survey that exposed the generations’ purchasing preferences and regional differences.
“Time is essential to people…they want to spend it doing what they want and not what they have to do,” says Lawby. The survey also found that 37 per cent of millennials planned to move within three years.
“The message for the sellers is that you must complete all renovations and tasks before putting your home on the market, it may be something as basic as painting a room. ” Lawby adds. Digital images of the home and virtual tours are becoming more important, sellers should be aware of how the home looks when presented digitally.
Century 21 Canada decided to conduct the survey to see “if it really was about location, location, location.” While the old maxim still applies, there is a general shift away from long commutes and greater focus on family time and career choices by the millennials. The survey showed a short commute was important to 45 per cent of millennials and only 25 per cent of baby boomers, the demographic group that caused bedroom communities to expand around larger cities a generation ago.
Boomers are looking to enjoy leisure time such as travel or hobbies in their move-in ready homes as they downsize. 28 per cent of boomers wanted funds left over when buying a house, compared to 18 per cent of millennials.
Many greying boomers (8.2 million according to Statistics Canada) no longer want to maintain a single-family house or empty nest.
“Baby-boomers don’t need to work,” says Lawby. “They are going into condos because they have the ability to close the door and walk away. They are cashing out to some degree in big cities and moving to the smaller communities.”
That cash-out of single-family homes is needed in cities to supply the base for entry-level condominium homes. “If you don’t have an entry point in the market, there is no first-time buyer. You are seeing in cities that they are wiping out whole blocks of single-family detached housing to build townhouses or row-houses as developers are optimizing the value of the land,” adds Lawby.
The millennial generation has a realm of other concerns. Many of the children of boomers (Stats Can figures estimate 9.1 million of them) either can’t afford single-family housing or don’t want to spend time cutting the lawn and renovating as their parents did.
They are looking for ways to maximize personal time and limit time spent on traveling to work, services or recreational facilities. There’s also a concern that interest rates, which have remained low for a prolonged period, will rise, infringing upon their ability to renovate a home.
The millennial generation is becoming clustered around work, often in cities, and fueling the high-rise trend experienced as intensification occurs.
The big drivers in how individuals in rural or remote areas are situating themselves are climate change and geography, says Lawby. Individuals in these communities also want to be near social activities or centers. “They want access to curling or skating indoors (in areas where winters are longer).”
The survey highlighted some regional differences in buyer preferences. In Atlantic Canada “they are looking for a good home in a good area many of the communities are smaller, so they are looking for good access to services and amenities,” Lawby says.
Quebec buyers place a high value on their social life and want to be involved in activities. “They want money left over after buying a home…and they want to be close to where they are working. They like the city, but don’t live in high-rises but in older properties.”
In the Prairies, says Lawby, there is a focus on wanting to be close to centers that can provide social or recreational activities. That is indicative of the harsh and long winters and home buyers want to be able to escape into a social atmosphere, rather than be isolated.
Alberta buyers, though, want to be situated in an area that generates a sense of community and that is family oriented. They are more interested in single-family homes than condos. They are entertainers and want a property that allows them to entertain inside and outside.
In Toronto and its suburbs, homes with character features are the hot ticket. There is some prestige in finding a character home in a nice area with trees and it feels like the kind of place that you would like to raise a family.
For more information on the findings of this survey or to discuss the marketing of your home, please contact one of our knowledgeable sales staff. We are here to serve you.