Today’s teens will likely never wait for transportation for more than two minutes, can buy nearly anything with the click of a button and have it delivered in 24 hours, and can instantly consult a cast of 1,000 of their closest friends on any decision large or small. These once far-fetched notions are the reality of a generation of teens 21 million strong. You may think traditional dreams wouldn’t fit into their modern world—but you’d be wrong. In the first study of its kind, national findings released today by Better Homes and Gardens® Real Estate reveal this generation of teens ages 13-17, part of Generation Z, is very traditional in their views toward homeownership and is willing to give up modern luxuries for the mainstream definition of the American Dream.
Four out of five (82 percent) of Gen Z teens surveyed indicate that homeownership is the most important factor in achieving the American Dream. For 89 percent of respondents, owning a home is part of their interpretation of the American Dream, followed by graduating from college (78 percent), getting married (71 percent) and having children (68 percent). How much does this dream really mean to today’s teens? Findings show that 97 percent believe they will own a home, and they are overwhelmingly willing to make sacrifices now if it means getting their ideal home in the future. Remarkably, 53 percent would be willing to give up social media for a year (tied with doing twice as much homework every night), 42 percent would go to school seven days a week and 39 percent would take their mom or dad to prom.
“We have a clear view of tomorrow through our millennial consumer research—now it’s time to look at the day after tomorrow,” says Sherry Chris, president and CEO of Better Homes and Gardens Real Estate. “Today’s teens are fiscally literate and realistic when it comes to their future. It’s quite profound that a generation that has never known a world without social media is willing to give up such a staple in their modern lives to achieve their dream home. With such mature insights at such a young age, Gen Z could very well be primed to be the next great generation.”
Not surprisingly, 95 percent of these Gen Z future homeowners believe they will take key steps in the home-buying process online. Viewing home listings and taking virtual tours reign supreme, however, 29 percent expect to video chat with real estate agents. While this generation has been navigating the mobile and online space for years, a 59 percent majority believe they will undertake the search process for their future home with help from a real estate agent. When it comes to buying, a mere 19 percent believe they are likely to purchase a home online, while 81 percent will use more traditional methods such as working with a real estate agent.
“For a generation living in an online world and knowing no limits to online commerce, seeing the overwhelming response from today’s teens on the value of working with real estate sales associates reinforces the importance of relationships and the human element in such a sophisticated and important transaction,” says Chris.
The Teen Home-Buying Scene
A Million Dollar Question: They are still young, but Gen Z is already considered one of the most entrepreneurial generations. However, when asked what they’d rather have in the future, 77 percent chose owning a home over owning a business. And while teen years are filled with aspirations and dreams, 54 percent do not believe they will achieve millionaire status in their lifetime.
Time to Buy: These savvy savers aren’t wasting any time. They aim to own their first home by age 28—three years earlier than the median age of first-time homeowners, according to the National Association of REALTORS®. They do however, expect to progress through certain traditional milestones before they purchase their first home like earning an advanced college degree (60 percent), getting married (59 percent), owning a pet (58 percent), and having children (21 percent). Seventy-six percent believe they are most likely to live with their significant other when purchasing a home versus living alone (15 percent) or living with a friend (8 percent).
Realistic Values: Gen Z teens understand the value of a home—literally. Of the 97 percent who believe they will own their own home, respondents estimate paying on average $274,323 to purchase their first home. According to the latest U.S. Census data, the median cost of a home today is $273,500, so they are right on track and already well-informed.
Parental Guidance: It appears the lessons of the Great Recession have not been wasted on this generation. In fact, 51 percent of Gen Z believe they know more about saving money compared to their parents at the same age. Of that group, 65 percent attribute this belief to discussions they’ve had with their parents about saving and 41 percent give credit to learning about the economic recession in school. Sixty-one percent believe they are more knowledgeable since they have already begun saving money. This generation may be getting more than just advice from their parents. Fifty-seven percent believe their Mom and Dad are likely to help them buy their first home.
Prime Location: While city living tends to appeal to young generations looking for a variety of career, entertainment and social opportunities, nearly half (47 percent) of respondents says their future home will most likely be located in a suburban neighborhood, followed by a city (23 percent), country or rural areas (20 percent) and destination locations (10 percent). Gen Z teens want to stay fairly close to where they grew up, but only 17 percent believe their ideal home would be located in the same town. Thirty-nine percent plan to stay within the region—like the Northeast or Midwest—and 36 percent plan to stay in the same state.
Grounded: Teenagers tend to be on a constant quest for the next best thing, but once they find their future home, they plan to stay put for a bit. On average, this generation plans to own just two homes in their lifetime. When it comes to prioritizing square footage versus amenities, it’s nearly a 50/50 split.
For more information, visit http://www.bhgrealestate.com.