Millennials dominate first-time buyers market
Tech-savvy and environmentally conscious millennials dominate the first-time buyers market.
With millennials now making up the single largest group of Canadian home buyers, according to Re/Max Canada, sellers are increasingly looking to customize their marketing strategies to cater for the specific needs of this group, particularly in the hot Vancouver market.
A Re/Max trends report points out that millennials dominate the first-time buyers’ market in Vancouver, favouring condos in particular. This generation is tech-savvy and environmentally conscious, both of which play a big role in their decision-making process.
According to Re/Max, millennial buyers are looking for:
- Green, energy-efficient homes with good insulation, efficient lighting and updated plumbing to save savings and a reduced the home’s footprint.
- Space for entertaining such as open, usable spaces to host friends and family. Open floor plans and functional outdoor spaces – a view of Vancouver’s waterfront is a bonus.
- The neighbourhood for some buyers is as important as the property itself. Millennials prefer to live closer to work and have access to green spaces and parks.
Ashley Smith, president of the Real Estate Board of Greater Vancouver, says affordability is also a critical factor for millennials when it comes to buying a home in the region, adding that a condo may be their only option, rather than the preferred option.
“While many people still dream of owning a detached house, others prioritize an urban setting over the traditional white picket fence. I do think there is a shift for many millennials more towards lifestyle rather than square footage,” she says.
For many condo developers in Greater Vancouver millennials are a key demographic and they need to include what those buyers are looking for in their new home, adds Smith.
“At the end of the day price point is still going to be the most important factor, but besides that, features like electric car charging stations give newer strata developments an advantage over older buildings, which may be more affordable, but not include modern features that millennials are looking for,” she says.
And with an increasing number of millennials giving serious thought to their environmental footprint and the cost of owning and operating a gas-powered car, electric vehicle charging facilities may become a must-have for their new home.
Another trend that may emerge as an added attraction for millennials is for strata developments to include a car sharing scheme as an amenity for the owners.
“We are hearing a bit more about it and I’m curious to know where it goes as a trend,” says Smith. “It’s certainly an interesting concept as more and more people become comfortable with the shared economy.”
Along with the usual gyms and bicycle storage facilities, an increasing number of new condo developments are hoping to attract millennials by adding amenities such as dog wash stations, doggy parks within the grounds – a high-value, low cost feature, says Smith – and home management technology in the units themselves.
Smith says another trend among millennials – albeit a controversial one – is the issue of rentals, including short-term rentals such as Airbnb, which are often restricted or banned by the strata itself or the municipality.
“I think millennials are not necessarily looking at rental as an investor, but they want flexibility. For example, they may need to move for work, or they move in with a new partner, but want to hold on to their condo and rent it out, which in many cases their strata does not allow,” she says.
For older buildings in particular, restrictions on rentals may deter millennial buyers, adds Smith. Rental flexibility – including short-term rental – is key to a buying decision for many millennials and she is watching carefully to see how it plays out in the Greater Vancouver market.