Generation Z, also known as Gen-Z, refers to individuals born between 1997 and 2012. As this demographic group reaches adulthood, they are increasingly becoming a significant force in the housing market. In recent months, it's become evident that reaching Gen-z homebuyers is going to be key for mortgage and real estate professionals.
Forbes shared that, “roughly 30% of 25-year-olds in 2022 – the oldest of the Gen-Z – owned their home in 2022, a slightly higher percentage than the 28% of Millennials (born between 1981 to 1996).” And that number is growing.
To reach Gen-Z homebuyers, it is important to understand their needs, preferences, and values.
Gen-z homebuyers live in the digital world
As a result of growing up in the height of the digital age, Gen-Z homebuyers are highly connected, tech-savvy, digitally proficient, and prefer to use digital tools and platforms to find and purchase homes.
According to the National Association of Realtors, “73% say texting or chatting online is their primary mobile activity.”
It is essential for real estate agents to have strong digital communication skills, online presence and use digital marketing strategies to target Gen-Z buyers effectively.
To better reach this demographic, real estate agents should use digital visual and interactive content, such as virtual tours, 3D floor plans, and interactive homebuying guides, to engage and educate Gen-Z buyers.
As Inman stated, “they appreciate being able to view a home remotely before going on a showing via technologies like virtual tour platforms.” If you want entice this group, you need to know what resonates with them and how to reach them.
Efficiency & ease of location
Gen-Z is the most urbanized generation in history, with a strong preference for living in walkable, transit-oriented neighborhoods with easy access to restaurants, shops and other amenities.
During the pandemic, the five largest U.S. cities all had net migration increases for Gen-Z, according to an analysis of Census Bureau 2021 American Community Survey featured on USA Today.
With that number growing, it’s evident that location efficiency is going to be a massive selling point for these homebuyers.
The environmentally conscious bunch
In addition, Gen-Z homebuyers are socially and environmentally conscious. They are concerned about the impact of their purchasing decisions on the planet and their communities. In fact, 76% of Gen-Zersare worried about climate change.
CNBC said that 73% of them are more likely to choose homes that are sustainable, energy-efficient, and environmentally friendly and pay more for it. Makes sense.
An effective strategy is to partner with sustainable homebuilders and developers that align with Gen-Z's values and preferences. This will help create a strong brand image that resonates with Gen-Z buyers and helps build trust and credibility.
Thinking ahead
Gen-Zers understand that homeownership is a perfect cocktail of building equity, long-term security and forced-savings, and therefore – out of precaution for the future – are taking a more judicious approach to their money, and are considering homeownership as part of their long-term financial planning.
According to a survey carried out by the American Psychological Association, Gen-Z consumers between the ages of 18 and 21 see money as their “top source of stress.”
These fears play an important role in how they are choosing to navigate their finances, and ultimately, invest in their future. It’s crucial for real estate professionals to re-enforce the benefits associated with homeownership throughout the process.
By having a deep understanding of Gen-Zer’s needs, values, and preferences, real estate agents can effectively reach and engage this increasingly important demographic.
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