Falling within the demographic group of real estate's red-headed stepchild, ages 18 to 34, I felt it necessary to defend my brethren from a realtor that clearly doesn't understand our relevance. Now, I'm no pied-piper, I'm not a leader of men, but I do know bs when I see it. I think that over the next 7 years, 18 to 34 year olds are going to be buying a significant amount of houses; and, subsequently, realtors should pay us more attention than we're currently getting-which is where Mr. Brady and I differ. . .
You're just back from Inman Connect? Forget everything you heard there. Chasing the hip, young 18 to 34 market is gret if you're selling sneakers but could be detrimental to the health of YOUR business for the next 7 years. here's why:
[Me] I disagree with my grammatically ignorant friend (“ain’t,” really?), to quote Jay-Z, “I’ve got ninety-nine problems but my bank account isn’t one” . . . or something like that. The monetary situation of 18-34 year olds is what it has been for the last few years:
· “According to the report, members of Generation Y command more spending power than preceding generations at the same stage of life "because they are well-educated and have higher starting salaries out of college."”
· In 2006: “first-time buyers, the median age was 32.”
· The long-term demand for second homes looks favorable because there are large numbers of people buying second homes. “Currently . . . 40.9 million are between ages of 30 to 39. These younger segments will drive the second-home market over the next decade.”
Don’t get me wrong, I’m not saying that my age demographic is the only action in town; but to say we “ain’t got no money” is not only offensive it’s just plain wrong. Maybe we don’t have as much money as some other age groups; maybe we don’t have as much money as Mr. Brady would like, but how much money do we need in order to be perceived as “worthy of a realtor’s time?”
2- They don’t trust real estate as an investment. This demographic believes that real estate is either perpetually overpriced or that it is dangerous. Some eschewed the asset class, some leveraged it irresponsibly and lost. It’s not that they don’t trust you because you’re a shady REALTOR, they don’t trust your product.
3- They view you as a functionary. Your value hasn’t been established to them because they haven’t had good experiences with real estate. They see you as an over-priced clerk because they watched you make “easy money’ while they chased the overpriced asset.
[Me] I’m addressing both #2 and #3 together because I think they both reek of bitterness. In #2, I think things are a bit backwards. We trust real estate as an investment; we just don’t trust shady realtors. And I think that the mistrust derives from the difficulties, the dragging of feet, that has occurred within the RE community in regards to accessible community data and housing listings on-line. If it’s not public: it’s a secret, it’s private; it’s trespassing; it’s not cool; it’s irritating to a generation of people that (for the most part) don’t know what the world would be like without the internet. And despite all the red tape:
In #3, I think someone sounds like their in desperate need of a hug. If it makes you feel any better, I value you Mr. Brady. I wouldn’t buy a house without you and I don’t think I’m alone:
[Me] Do we really need an education? If old is now new in the world of lending (with FHA mortgages—a.k.a the first time buyer mortgage—making a comeback) I have to wonder what age group would be fueling such a trend. Because I would assume, if Baby-Boomers wanted to purchase more real estate, they would walk across their summer home's beautifully landscaped lawn and shake their money tree . . . No lending necessary!!
5- They really don’t have any “pain”. They’ll be focusing on mitigating losses rather than maximizing wealth. Their “pain” is best served by loss mitigation specialists and not wealth maximizers.
[Me] I can’t believe that such a broad generalization could actually be conceived as sound reasoning.
So…if that’s true, why the hell are you screwing around on Facebook and Twitter? Because the fastest growing user groups on those two social networks are the cheese, baby…the 45-65 age group.
[Me] Erroneous!! One particular month is not indicative of Facebook’s overall growth last year. In fact, if you read the article hyperlinked in Mr. Brady’s post, and check the original press release it references, you’ll see that “The most dramatic growth occurred among 25-34 year olds (up 181 percent), while 12-17 year olds grew 149 percent and those age 35 and older grew 98 percent.” Baby-Boomers were the 2nd slowest growing user group. And Twitter never even came up.
PS: I’m generalizing when I categorize the demographic groups. There are a lot of successful and responsible 18-34 year-olds but your odds are better with their parents until 2015. The cool part is that 80% of your competition will buy into the Youth Myth while you clean up on the Boomers.
[Me] I tip my cap for recognizing the generalizations, but I’m still not sold on the Baby-Boomers being in a situation to buy more homes in the next 7 years. I mean, unless the Boomers have severed all ties with their children, I think their situation isn’t exactly “pain free.” If I’m doing the math right, a Boomer’s kid (depending on their age) is in need of College tuition, help with paying for their wedding, purchasing a home, clothes for grandkids . . . good parents do these sort of things so that their kids don't have to worry about starting their adult lives in debt and they can (for argument's sake) buy a house. I’d say that Boomers aren't going to be looking for a retirement home, investment property, or vacation home for . . . about 7 years from now.
Image Credit: Paul Stevenson on Flickr.com