- RISMedia - http://rismedia.com -
Real Estate Gets Younger
Posted By Paige On December 20, 2007 @ 11:02 AM In Today's Top Story | Comments Disabled
By Eugene L. Meyer
RISMEDIA, Dec. 21, 2007- Just when you thought the clouds on the real estate horizon were getting even darker, a ray of sunshine pops through in the housing futures market. A new survey has pinpointed the number-one goal of today’s college students. It’s owning a house.
“I think that’s fantastic,” says Lennox Scott, chairman and CEO of the Pacific Northwest’s John L. Scott Real Estate. “There are 75 million of them, and they’re coming our way.”
Of course it may be a decade before they enter the housing market, but it’s never too soon to plan ahead. Knowing now how to reach the next generation of homebuyers when the time is right could pave the way to success down the road.
The top-ranking given to housing was almost equally true for both men and women-though more so for females-in the recent back-to-school survey conducted by Anderson Analytics, a “next generation” marketing research firm in Stamford, Connecticut.
“Hopefully they’ll have the money soon. They sure think they’re going to have that house soon,” says Tom Anderson, managing partner of the company that bears his name. That’s partly due to the popularity of shows like “Flip This House” and “Total Home Makeover,” coupled with the belief in entitlement and ease in obtaining the American dream that is prevalent among this group.
“They have boomers as grandparents,” Anderson explains. “So this generation has more money at their disposal than other generations did at their age. They are sort of used to getting want they want.”
From the Mouths of Babes
For the telephone survey, conducted Aug. 8 to Aug. 31, this year, interviewers reached 1,000 college students-539 female and 461 male. The subjects came from Brandport.com, which, according to its Web site, “facilities interactions with young consumers across the country.”
The average time of the interviews, involving 34 questions, was 12 minutes. Respondents represented more than 375 colleges and universities. Their student status was confirmed by “dot.edu” e-mail addresses. Anderson refers to those born just before 1980 to 2000 as “Gen Y,” which includes current college students.
Much of the survey focused on their favorite social networking sites, with Facebook ranking first for both genders. But at least one of the questions elicited the surprising good news for brokers.
Students were asked to complete this sentence: “If I could buy anything, it would be…” Housing was the top choice for 41% of the men and 49% of the women. Owning a home scored higher than other, seemingly flashier possessions, such as a car, which came in second, or clothes, which ranked third with women and at the bottom with men.
“I think because there is so much talk today about the real estate market, relatively young college students recognize the value of real estate as an investment,” says Cliff Lampe, an assistant professor in the department of telecommunication, information studies and media at Michigan State University. “And I think part of it, too, is houses might be the new cars” as a desirable status symbol.
Perhaps even more significant in Anderson’s third annual back-to-college survey, the percentage choosing a house was higher than in the past. In 2005, only 22.6% ranked a house as their top choice. “It’s always been a big one, especially for young Gen Y females,” Anderson says. “It’s increased in the last few years.”
“I didn’t have as lusty dreams when I was in college,” adds Anderson, 36. “I was just thinking about girls, maybe a car, maybe a job when I graduate, but I wasn’t thinking about a house quite yet. These kids are still in college. They’re already thinking about the house.” He did become a homeowner, however, while still in his twenties in 2000.
Thinking Big…and Smart
Renee Horowitz, 24, a recent graduate of Post University in Waterbury, Connecticut, worked part-time for Anderson last school year as a “GenX2Z College Ambassador,” videotaping and interviewing some of her class and dormitory mates.
Like many of those interviewed in this year’s survey, she ranks owning a house as “a ten or a nine” on a one-to-ten wish list scale. “If you have a house, you have equity,” she explains. “Like, if you have a family, you have a house for them, and you could also fix it up and sell it, especially in the area where I am, for a lot of money.”
University of Maryland students interviewed at a campus Starbucks also appeared to reflect the survey results. Tina Brandemarte, 21, an economics major from Annapolis, and Jenna Czaplicka, 21, a marketing major from New Jersey, both put a house at the top of their list. Brandemarte said she wanted a house on the North Carolina Outer Banks, Czaplicka a home in tony Bergen County, New Jersey, with “a lazy river” around it. Both said their favorite social networking site is Facebook.
Laura Polm, 19, an equine studies major from Annapolis, also wanted first and foremost “somewhere to live.” In her case, that somewhere was a farm house, with horses. She said she also frequented Facebook.
Today’s students, the survey found, are “very materially focused.” The desire to become homeowners may be nurtured by their current living arrangements. Fifty-seven percent lived in an apartment during college, with or without roommates, while only 11% lived in a school dormitory room.
Information: An All-Access Pass
“There is so much information out there, and so many of these college kids are more financially savvy, they are starting their financial plans earlier, developing ways to invest earlier,” explains James McGowan, an agent with Atlanta-based Prudential Georgia Realty.
This growing sophistication may reach even beyond GenY2Z. “They’re seeing how a young child in California puts a skateboarding video on YouTube and suddenly gets all these endorsements and becomes successful. They see that they, too, can become and do and earn,” says DeAnn Golden, Prudential Georgia managing partner.
And their interest in real estate is palpable and precocious. “I was talking to a 14-year old the other day who wanted to understand and know what an appraisal was and how to start saving for a house,” marvels Golden.
The fact that women have a higher preference for housing as their top purchase than men, according to the survey, might also be something for marketers to consider. In the profusion of home purchase or makeover television shows, in which couples compare houses or make decorating decisions, it’s apparent that women are the deciders, with the men pretty much good-naturedly going along with the program.
While both sexes chose Facebook as their top Web sites, they differed on the second choice, women choosing MySpace.com and men ESPN.com.
Social networking is twice as popular among young women as men, suggesting that marketers who want to target females are wise to use this medium of communication.
“The social networking problem is something that marketers in all industries are trying desperately to understand,” Anderson explains. “Some immediate implications are, if you’re more networked, you’re probably going to look to your network first to find a real estate agent, and to who has recently purchased houses, or for information on market values. Web sites are number one for both genders, more important than family.”
Or to put it another way, Anderson says, “Web sites are more important than real people.” That might sound counter to the prevailing industry view of real estate as a relationship-based business. Yet, interaction through social networks also involves relationships, just on the Internet.
The Technological Implications
Brokers and their tech-savvy young agents would do well to consider the challenges and the possibilities. There is the potential, for instance, to reach Facebook users directly from their pages. As Lampe explained it, anyone can write an application that Facebook users can plug into, but so far brokers haven’t taken the initiative.
Though some agents have their own Facebook sites, the APT-or application performance interface-represents a new frontier. Users browse new applications, which anyone can write and upload into Facebook for free, and add them to their own sites.
So, you write your application for Facebook. What next? Explains Lampe: “You put it out there. You get a few people to use it. You do a good write up to show why it’s of interest to the person. It explodes. Lots of people use your application, and you don’t have to pay Facebook anything. Each user makes a decision to use that application, or not. They know it’s available because they’ll browse the application list and check it out. The way it gains market share is they’ll see their friends are using it and try it out.
“You could imagine people on Facebook adding that application as they’re searching for housing,” says Lampe. “The GenXY group expects databases to be linked automatically together and provide information to them. For better or worse, one of the changes with these generations is they’ve grown up with Wikipedia and Google and expect a lot of information to come to them rather than do a whole lot of searching for information. Marketing to this new generation has to be less intrusive than in the past and more immediate. ”
The change in how people communicate has been rapid. When Lampe, 34, bought his home two years ago, he used the Internet but not Facebook.com.
“I didn’t use social networking. A couple of years ago sites like MySpace and Facebook hadn’t integrated other database resources into their applications,” he reports. “Facebook has taken off, especially in terms of making it much more possible to seamlessly integrate multiple information resources into one application. The landscape is now really different than it was two years ago.”
Article printed from RISMedia: http://rismedia.com
URL to article: http://rismedia.com/2007-12-20/25094/
Copyright © 2012 RISMedia. All rights reserved.