The thing about demographics that makes them fun and interesting to watch is they move in patterns and rates which we can sort of observe in real time. Not quite as fun and stunning as watching flock of birds moving in harmony, but oddly similar.
According to the National Association of REALTORS forecasting, by the end of 2022, as many as 45 million American Millenials will have entered their ‘first home buying prime years’ of between 26 and 35. Currently, 41.5% of all American mortgages are held by Generation X. But it is the boomers we should be looking at more closely at perhaps, with 27.3% of that mortgage share.
The pandemic has changed how Americans think of housing
The shift that is starting to occur in American housing will be interesting, and not without significant upheaval. The pandemic has changed how Americans think of housing, and so is undoubtedly going to change housing itself. But this is also happening against a backdrop of the collision of huge demographic forces.
Prior to the pandemic, there had been a large generational shift happening – ‘the backyard was going to become the front yard’, we were told. The front porch was suddenly all the rage, driven by a cultural generational shift. But at the same time, the idea of owning a suburban mcmansion was anathema to a lot of millenials – we kept hearing how a lot of them didn’t want to own a car!
These are all just generalizations of course, just pattern analysis – which way is the flock going to move next? But it is driven by real data and there are fascination questions it begs, and conclusions to draw if we are bold enough to do so.
The Pandemic has ushered in a new ‘my home is my castle’ movement. Fueled in part by changes in work patterns, freeing deskbound workers to telecommute from a home office, Housing soared from 2020-2022. And this atop double digit year over year appreciation for nearly a decade straight prior to that. It is really hard to see the dark housing days of 2007-2009 in the rear view mirror. At least at the moment, the rural, residential home is as coveted an asset as it has ever been.
What will the buying patterns and habits of these Millenials look like? Will rates price them out of the market? Will there be a glut of housing hitting the market as selling conditions worsen? What will happen to that massive slice of American housing owned by aging Baby Boomers looking to downsize? How will all of these swirling trends interact with each other, and which way will the flock move?
Most of these folks have had a smartphone their entire adult life
These are really fascinating questions. To be honest, it is hard to venture a guess. But we are really interested in and willing to guess about is the sort of buying experience these Millenials are going to embrace. Most of these folks have had a smartphone their entire adult life. They are web natives and in many cases already ‘digital citizens’ of various communities. Translation? They do a lot of the things in their lives online.
At Block Gurus we are really excited to try to meet these young consumers, and the generations that follow, with tools and data that make sense in a fully digital world. We think this involves helping to bring REALTORS, and the consumers they serve, together in Web3. We look forward to showing you more.
For now, for a small practical example, consider listening to the following 2 episodes of our podcast: