According to Transunion, Generation Z is the one buying homes.
These are individuals that were born in 1995 and after. The Majority of them are getting credit cards, buying vehicles and purchasing homes.
Realtor.com also cited that they are poised to be a major consumer in the housing market in the next five to ten years.
A group of 65 to 75 million young individuals will be the upcoming significant consumers, not only in housing but in almost all sectors of the credit market.
The majority of the car credit market is the Gen Zers, according to Transunion, it grew to 1.3 million borrowers in that sector. That is more participants than Gen Xers and Millennials.
Behavior is different with this generation as well. They are tech-savvy, DIYers and can work online, thus giving them the flexibility to work farther outside the expensive part of town.
McMansions are not the priority
The popularity of fixer-upper shows and the growth of YouTube DIYers gave them the confidence to tackle smaller projects themselves. Therefore, making them more flexible in considering smaller homes with repairs that they can tackle.
As Generation Z are the ones buying homes, they are looking into smaller houses and are more flexible to live outside of a big metropolis. Taking advantage of remote work helps them to think out-of-the-box when buying homes.
They are also saving up more and tend to stay with their parents longer. As one executive with Bank of America, D. Steve Boland, head of Consumer Lending at Bank of America. “Despite their young age, this group is pragmatic and actively planning for their future. They recognize buying a home isn’t easy and has a clear vision not only about where they plan to get help but also how they are willing to help themselves in order to make it happen.”
Given that these individuals saw the brunt of the great recession. They are more financially practical and are not buying more than they can afford, according to the same research with Transunion.
Primary Hurdles
With housing prices still high and affordability still an issue, thus the lacked lustered performance of home sales. Generation Z is entering the housing market, buying smaller homes and fixer-upper alike, real estate experts say.
Since Generation Z are the ones buying homes and they are getting help with immediate family members for a down-payment. They are more financially conscious and are saving more towards a down payment than a dream wedding or a shopping spree.
