Tuesday, October 4, 2011

Generation Y To McMansions: No Thanks

They're listening, slowly:

“As a result, demand for smaller homes should increase steadily as the baby boomers age,” the Joint Center report states. Since young first-time homebuyers also tend to purchase homes that are smaller and less expensive than average, ‘echo boomers’ will add to the demand for more modest housing as they replace the smaller baby-bust generation in the under-35 age range, researchers note.
Of course, don't make the mistake of assuming that smaller homes will mean that Echo Boomers want less quality. While Echo Boomers may find more interest in the smaller homes, they still are attracted to features like hardwood floors, granite counter tops, et cetera. This information only indicates that smaller homes have more appeal in the housing market at this time (in the long run, Echo Boomers may want larger homes).

Real estate developers might also falsely assume that if Echo Boomers don't want large houses, that will mean less profit, yet the volume of business from potential Millennial buyers could easily offset the loss. The trouble, of course, is that Echo Boomers may not want homes in the long run, in which case the real estate industry will suffer two hits. However, Echo Boomers may view homeownership as McMansion demand, so smaller homes may increase your Millennial customer base.