Do you know that story that the new generation has settled down and is living in their parents’ house until they are over the age of 30? Well, that’s not how young Americans are behaving. Quite the opposite! They are responsible for moving the luxury real estate market by buying multi-million dollar homes.
Known as millennials, those born between 1981 and 1996 represent 30% of homebuyers in the United States. The data from the National Association of Realtors shows that the generation ends up taking longer to aiming high. Unlike their parents, who bought a bigger house only when they started a family, young people are already looking for millionaire luxury properties in their first acquisition.
The power of the Millennials
As the generation with the most study in history, Millennials have very high incomes and the possibility to inherit some assets from their previous generations: the perfect formula for the acquisition and maintenance of goods. The generation is also responsible for changing the perception of luxury properties. With remote work, Millennials have the possibility to live in smaller cities with lower costs of living. In this way, the value of the property can be much higher. This shows, according to Sotheby’s report on global luxury in 2021, how this generation has unique consumer preferences that are already changing the luxury real estate market. Among the new values, there is the environmental and sustainable concern and the need for a lot of technology.
In this way, properties that allow contact with nature took the lead, and, as a result, regions such as Aspen, Austin, Colorado, and Texas stood out and showed an increase in average sales prices. Still according to Sotherby’s, the perspective is that the values will increase even more – and not only in the United States!
A new market
Because they are the biggest buyers in today’s luxury real estate market, millennials have changed the way the industry operates, which needs to meet the needs of its biggest buyer. Now, developers need to include state-of-the-art technology in real estate and guarantee some sustainability certificates. In addition, green roofs, solar panels, and energy-saving systems are the new needs that will be priorities in the future.
With this, experts believe that the price of real estate will increase, as well as the demand and consequent purchase. On the other hand, Sotherby’s believes that power will be in the hands of young American consumers, as unequal control of the pandemic can hurt foreign buyers.
Another point that creates uncertainty if the rise in the global luxury real estate market is how governments are dealing with property and wealth taxes, as some tax implications can make property buyers rethink business.
Even so, the sector continues to be heated by young people, who are increasingly anxious to acquire the house of their dreams. Even though the options for this group are scarce and rarely meet exclusive tastes, the movement is very promising for the luxury market.