We are led to believe that with age comes wisdom, but this is generally a quote trumpeted by jaded curmudgeons. Nothing is more powerful than a positive mindset and how it can help people achieve their dreams regardless of time clocked. I’ve met as many brilliant twenty-year-olds as I have ignorant, old fucks. When I was in my twenties, I believed I could conquer just about anything. I still possess an innate stubborn mindset that drives the power of my dreams. When we are young, blissful ignorance protects us from jaded experiences that might stunt us. As we get older, we question ourselves more and allow outside negative experiences to dim our aspirations. A good friend of mine recommended Jim Kwik’s book “Limitless” to me. (Thanks Gary). It’s a great read that eloquently describes our mindset and how it affects our ability to prosper. I am a member of Generation X and my children are members of Generation Z, so I have some first-hand insight into them. The millennial generation, however, seems to be coming into its own and taking center stage. At first, Millennials earned a reputation of being difficult, entitled, and spoiled, much like a toddler. But as they have aged, they have evolved into a generation that is optimistic, resilient, open-minded, socially progressive, and well-educated. They are powerful and I have witnessed their identity because a large part of the team who works with me at CORE fits into this category.
Recently, Millennials have shown the world their awesomeness by wielding their power on TikTok by dismantling and sabotaging a Trump rally in Tulsa. They have also recently disrupted traditional institutional investment principles with the RobinHood app, leaving some economists scratching their heads. Their power reaches far beyond politics and finance. They are the largest living generation and the largest age group in the workforce. They are also the largest demographic of home buyers in the United States and will have a major impact on how our real estate industry evolves. This week, the National Association of Realtors announced that for the month of June, first-time buyers made up 35% of home sales, the highest number in a decade. I expect this number to rise as mortgage rates continue to drop. I’m not sure how much lower these rates can go, but we can expect to see this wave of first-time Millennial buyers swell into a tsunami. They finally got the memo that owning a home is better than renting long-term because when they punch the numbers, the index now favors home ownership. Simply stated, you can pay less every month to own a home than it would cost you to rent. But here’s the problem we face... Millennials don’t want to live in the same types of homes that Baby Boomers and Gen X built. The way they see and use every room in the house is different. They value smart design, not brand names. The conversation about how a living room works doesn’t revolve around the location of the television. The main bedroom (formerly known as the master suite) doesn’t need to be oversized with a his and her bathroom and separate closets. The kitchen counter should multi-function as an integrated place to eat, work, and play, not as a buffer between chef and guest. McMansions are out. Smart, efficient space is in.
As these new homebuyers continue to recognize the opportunity that low interest rates bring, they will drive the market up by scooping up homes that resonate with them. Architects, designers, and developers are going to need to take off their blinders and open their eyes and ears to this generation. This is a burgeoning market that will bring opportunity to those who have the right mindset to design and deliver homes to this generation of buyers.