What Millennial and Gen Z Real Estate Clients Really Want in 2021

If you’re still thinking of Millennials as 20-somethings, think again.

While the youngest of this demographic are still in their late 20s, ‘elder Millennials’ will turn 40 this year. 🤯

As the dominant force in the real estate market, agents need to know how to tune into their Millennial clients — not to mention the group that is just beginning to emerge in the market, known as Gen Z.

But in a competitive and fast-changing market, how do you navigate client demands and connect with the new generation of buyers and sellers? How do you go beyond the hype and headlines to find out what really matters to Millennial and Gen Z clients?

We’re here to share everything real estate agents, brokers and team leaders need to know about these two influential generations, including their top demands for the real estate journey and how you can create a client experience they’ll never forget.

Inside the Minds of Millennial and Gen Z Clients:

• Selling real estate to Millennials? Here’s what you need to know

• Coming Soon: Generation Z enters the real estate market

• The top trends and expectations driving Millennial real estate clients

• 3 tips for reaching Millennial and Gen Z homebuyers

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Selling real estate to Millennials? Here’s what you need to know

Let’s be honest: What you know about Millennials (born 1981–1996) is probably…not all that flattering.

For years, Millennials have taken heat from the media with stories focused on self-centeredness, materialism, and entitlement — from irresponsible avocado toast addictions to killing off entire industries.

But what is the Millennial generation really about? To figure that out, we’ll have to explain where they’re coming from.

Growing up in an unstable world

The ironic thing about Millennials and real estate is that real estate is central to the Millennial story.

That’s because the Great Recession is one of the defining events of their generation. The housing bubble and subsequent financial crisis happened just as they entered the workforce, which has profoundly shaped their outlook.

If you thought selling real estate in 2008 was tough, imagine being a young working Millennial watching the entire economy collapse (and the vast majority of your potential career opportunities disappear right along with it).

In contrast with their parents — mostly Baby Boomers who grew up in an era of “family stability, widespread prosperity, and cultural cohesion” — Millennials inherited a world that is decidedly more precarious. Here’s how David Brooks, author of The Road to Character and The Second Mountain: The Quest for a Moral Life breaks it down:

“[Millennials] grew up in a world in which institutions failed, financial systems collapsed, and families were fragile. Children can now expect to have a lower quality of life than their parents, the pandemic rages, climate change looms, and social media is vicious. Their worldview is predicated on threat, not safety.”

Student debt is no joke

While they may be better educated than their grandparents, the cost of higher education has skyrocketed, leaving many Millennials burdened by significant student debt. Unfortunately, according to research by the Federal Reserve, Millennials have lower incomes, fewer assets, and less wealth than prior generations — in other words, less power to get out of debt or save for a down payment.

Technology and the internet

Being a Millennial isn’t all bad, though. This generation also grew up during a period of rapid, exciting technological advancement.

While they may be able to remember the days of VHS tapes and built-in car phones, younger Millennials ultimately came of age carrying a smartphone (and all the world’s knowledge) in their pocket. Lightning-fast answers have become their norm.

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Coming Soon: Generation Z enters the real estate market

As Millennials step into middle adulthood, Gen Z (born 1997–mid-2010s) is quickly approaching the homebuying age. But while Millennials and Gen Z share many similarities — including feeling unsettled, insecure, and slightly jaded about the American dream — they are different in notable ways too.

First off, Gen Z has never lived in a world without the internet or cell phones.

The implications of this cannot be overstated. Gen Z is more active online and on social media than any preceding generation. From communication to content consumption, smartphones are central to daily life for Gen Z. They are accustomed not only to instant connectivity, but constant connectivity, and their digital lives are all but inseparable from their “real” ones.

Gen Z is also the most racially and ethnically diverse generation in our nation’s history (although Millennials previously held that title). They’re also leading downward trends of teen pregnancy, alcoholism, and drug use — a possible sign that they’re more risk averse than their predecessors.

As more of Gen Z enters adulthood, we’ll see how these characteristics play out in their real estate priorities and preferences, but for now, the trends for Millennials may provide some hint of what’s to come.

The top trends and expectations driving Millennial real estate clients

The defining events that shaped the Millennial generation also impact their priorities when it comes to real estate.

But you may be surprised to learn how some of those priorities have shifted as Millennials have reached mid-adulthood — and how the pandemic altered them, again. Check it out:

Starting family life

If Millennials are pretty jaded about ‘adulting’, can you really blame them? Research has shown that they’ve been slower than previous generations to reach major milestones like marriage and parenthood, and it’s likely that risk-averse Gen Z will follow in their footsteps.

But like we’ve already said, Millennials are older than you think. So while it may have taken them longer to get started, many Millennial families are well underway and already adding to the ranks of Generation Alpha.

What they’ll be looking for: Family-friendly neighborhoods, good schools, more space

Health and work-life balance

Millennials are far less likely to be workaholics than their predecessors. Instead, this generation is known for the value they place on health, wellness, and developing a favorable work-life balance.

What they’ll be looking for: Shorter commutes, access to lifestyle wellness amenities, healthy food options

Online life and social media

The internet has given Millennials and Gen Z more access to information than ever before — and the real estate industry is no exception. In fact, casually browsing online home listings is so common that it’s even been spoofed on SNL.

Social media has also deeply impacted real estate for Millennials and Gen Z. In addition to marketing and paid ads, hyper-visual platforms like Instagram have spawned unique real estate accounts like @zillowgonewild and @cheapoldhouses.

Meanwhile on TikTok, house flippers are taking followers through their renovation process, home inspectors are roasting remodels, and agents are spilling their best tips. (And of course, we have TikTok to thank for this magnificent video.)

What they’ll be looking for: More transparency in real estate, opportunities to build sweat equity

The power of a pandemic

Home ownership may have seemed like a pipe dream for many Millennials. But despite the devastating impact of the pandemic, there may be at least one silver lining: Working remotely (and even quarantining with their parents) enabled many Millennials to save money on transportation, food, housing, and entertainment costs — which could then go towards a down payment.

What they’ll be looking for: More buying, less renting

A great migration

That’s not all that changed as a result of the pandemic. Millennials were once called “the most ‘bright lights, big city’ generation in history” as they flocked to urban areas.

Now, not so much.

As many employers have reconsidered the need of being in the office five days a week, employees are reconsidering their proximity to the office. The promise of a reduced (or eliminated) commute has prompted many Millennials to relocate from expensive cities to more affordable areas.

What they’ll be looking for: Getting more bang for their buck while optimizing their lifestyle

3 tips for reaching Millennial and Gen Z homebuyers

It’s clear that Millennials and their Gen Z counterparts have higher-than-ever expectations when it comes to real estate. To connect with these groups, real estate agents will need to understand where they’re coming from and adopt new strategies that meet their needs.

Here are three simple tips to help win them over.

1. Be transparent

For agents, being transparent is a great strategy for nurturing relationships with the new generation of real estate clients. Not only are these groups accustomed to having unprecedented access to information, but the importance of having access to that information carries even more weight than it did for past generations.

Remember, the Millennial and Gen Z generations are less trusting than their predecessors. Win their loyalty by being transparent and upfront.

2. Let them to take the lead (at least, sometimes)

There’s no doubt that portal sites like Zillow have radically changed the real estate game. Today’s homebuyers and sellers are entering the market with more information than ever before, and buyers may spend months browsing Zillow and other home listing sites before they ever even contact an agent.

Don’t be surprised if buyers come to you with a list of homes they’re interested in — or if sellers have a stack of comps they’ve reviewed. This can be advantageous if it helps your clients get a clear sense of what they want…but it can also be a challenge if they develop unrealistic expectations.

As sellers, Millennials are also more likely to take a more active role in photographing their home and promoting it on social sites. But when facing a client with a DIY mindset, some agents may face challenges when it comes to negotiating commissions. (Yet another reason why setting yourself apart with an amazing client experience can translate into real ROI your business.)

3. Use tech wisely

Millennial or not, we’ve all become accustomed to the speed and convenience technology delivers. Tech has become both a disruptor and a propeller in real estate and this trend has only accelerated in the wake of the pandemic.

But for Millennial and Gen Z homebuyers and sellers, digital experiences have always been the norm. Today’s real estate clients expect the real estate process to be digital — from the very first step of their home search through signing their offer. (Honestly, they may even be surprised if you hand over a stack of physically printed and stapled listings at your first appointment.)

Instead, take advantage of the amazing tools available to help make the home buying and selling experience easier for you and your clients. Preclose GO! is a digital home buying and selling platform that helps you do more than meet client expectations — it helps you exceed them.

With Preclose GO!, communication and collaboration is so simple and transparent, your buyers and sellers will be referring you to everyone they meet. Try it for free today!